FG Slashes Import Duties on Food, Vehicles to Ease Cost of Living

        

ABUJA, Nigeria . The Federal Government has introduced sweeping reductions in import duties on essential goods as part of its 2026 Fiscal Policy Measures (FPM), aimed at reducing the cost of living, easing inflationary pressures, and stimulating economic growth.

The new tariff regime, which took effect in July, reduces import duties on 127 product categories, including staple foods, passenger vehicles, industrial machinery, and electric vehicles.

Among the major changes, import duty on bulk rice has been cut from 70% to 47.5%, while broken rice now attracts a 30% tariff. Duties on crude palm oil and raw cane sugar have also been lowered to reduce food production costs and improve affordability.

In the transport sector, import duty on passenger vehicles has been reduced from 70% to 40%, while mass transit buses, electric vehicles (EVs), and manufacturing machinery have been granted zero import duty to encourage cleaner transportation, industrial growth, and lower logistics costs.

The policy comes as Nigeria continues to battle inflation and rising living costs, with analysts hoping the measures will ease pressure on households and businesses.

However, industry stakeholders have cautioned that the tariff reductions alone may not significantly lower prices. They argue that exchange rate volatility, high port charges, shipping costs, terminal fees, and logistics expenses remain major factors driving the final cost of imported goods.

Experts also warned that lower tariffs on imported food and vehicles could undermine local manufacturers and farmers if not accompanied by stronger support for domestic production.

Despite the concerns, many Nigerians remain optimistic that the reforms could gradually reduce transportation costs, improve the availability of goods, and help moderate food prices over time.

The new tariff policy is one of Nigeria's most significant fiscal reforms in recent years. If effectively implemented alongside broader economic reforms, it could help lower the cost of essential goods, encourage investment, improve transportation, and support manufacturing. However, its success will depend on stabilising the exchange rate, reducing port inefficiencies, and ensuring businesses pass cost savings on to consumers.