FG cuts import duties on rice, vehicles, others

By Abubakar Yunusa

There is relief as the Federal Government, through the Ministry of Finance, has approved the implementation of the 2026 Fiscal Policy Measures, introducing wide-ranging changes to import tariffs to stimulate economic growth.

A major highlight of the policy is the review of import duties across 127 tariff lines, including rice, sugar, vehicles and key industrial inputs.

The approval was contained in a document dated April 1, 2026, and signed by the Minister of Finance, Wale Edun. The new policy replaces the 2023 Fiscal Policy Measures.

The government said the reductions were designed to “promote and stimulate growth in critical sectors of the economy”.

Under the revised regime, the Import Adjustment Tax on products such as crude palm oil has been fixed at an effective rate of 28.75 per cent, down from previous rates.

In the automotive sector, tariffs on fully built passenger vehicles, including four-wheel drives and station wagons, have been reduced to 40 per cent from 70 per cent under the 2015 policy.

To ease the transition, the government granted a 90-day grace period for importers who opened Form ‘M’ before April 1, allowing them to clear goods at the old rates.

However, a new excise duty regime and a green tax surcharge will take effect from July 1, 2026.

Details of the revised tariffs show that duties on bulk rice have been cut to 47.5 per cent from 70 per cent, while broken rice now attracts 30 per cent, also reduced from 70 per cent.

Crude palm oil duty dropped to 28.75 per cent from 35 per cent, while raw cane sugar now stands at 55 per cent, down from 70 per cent.

Similarly, tariffs on fully built vehicles were slashed, while several industrial materials, including zinc-coated steel sheets and aluminium-coated steel coils, now attract 35 per cent, reduced from 45 per cent.

The policy also introduced zero per cent duty on selected items such as railway locomotives, cargo ships, agricultural and manufacturing machinery, as well as breathing appliances.

In addition, duties on electrical components like fuses and circuit breakers were reduced to between 10 and five per cent.

On green tax exemptions, the government listed vehicles below 2000cc, mass transit buses, electric vehicles and locally manufactured vehicles among those excluded from the surcharge.

The government said the reforms were aimed at balancing revenue generation with economic stimulation, while supporting local industries and reducing the cost of critical imports.