IMF Urges Nigerian Govt To Impose Fuel, Telecom Taxes

The International Monetary Fund (IMF) has urged the Nigerian government to introduce taxes on fuel products and telecommunications services in order to increase revenue and create fiscal space for development spending and social interventions.

This was recommended in the IMF’s 2026 Article IV Consultation report on Nigeria, where the Fund argued that additional tax measures would be needed over the medium term despite the recent overhaul of the country’s tax system.

“Further tax policy changes will likely be needed—such as increasing the VAT rate, extending VAT to fuel products, rationalising tax expenditures in particular VAT exemptions on extractive industries and some customs duties, and introducing telecom excises—to complement administrative gains,” the IMF said.

The Washington-based institution, however, cautioned that the timing of any new taxes must take into account Nigeria’s rising poverty levels and worsening food insecurity.

“The timing of reforms must consider the poverty and food insecurity situation and ensure that the cash transfer system is in place and funded,” the Fund added.

Meanwhile, the recommendation may reignite fresh debate across the country as a previous attempt by the federal government to introduce a five per cent excise duty on telecom services faced widespread opposition from operators, subscribers and consumer advocacy groups before it was eventually suspended and later scrapped.

This also comes as IMF projects that Nigeria will need stronger revenue mobilisation efforts to sustain planned increases in public spending and support vulnerable households.