Nigeria’s logistics industry, which moves over 90 percent of the country’s goods by road, has long struggled under the weight of excessive taxation, with operators facing more than 200 official and hidden levies along major highways. The new tax reforms, announced by Taiwo Oyedele, head of the Presidential Tax Committee, aim to ease this burden and revitalize the sector, starting January 2026. The measures are expected to lower operational costs, simplify tax compliance, and attract investment into transport infrastructure.
Under the reforms, haulage and logistics companies earning N100 million or less annually will be exempt from income tax, while larger companies will pay a maximum rate of 25 percent. Employees earning up to N100,000 monthly will also be exempt from Personal Income Tax, with progressive rates applied to higher incomes. Oyedele emphasized that the aim is to protect vulnerable workers while maintaining a sustainable revenue system for government services.
Essential goods including food, water, educational materials, and transport will now be exempt from Value-Added Tax (VAT). Previously, producers could not recover VAT paid on production inputs, but the new zero-rating system will allow full refunds, benefiting both businesses and consumers. Oyedele stressed the importance of accurate record-keeping to ensure transparency and compliance under the new framework.
The reforms also introduce investment incentives under the Economic Development Incentive for Priority Sectors. Transport operators investing in traditional, electric, or CNG-powered vehicles may qualify for tax holidays of up to ten years. Additionally, a 5 percent fuel surcharge will be reintroduced to fund road maintenance, with proceeds shared between federal, state, and local governments, ensuring dedicated funding for infrastructure improvements.
While these reforms promise relief, challenges remain in implementation. Oyedele acknowledged the difficulty of eliminating entrenched corruption and illegal charges but assured that digital systems, tax ombudsman services, and a streamlined process will eventually reduce physical tax barriers. For the logistics industry, the hope is clear: fewer levies, better roads, and a more predictable operating environment that supports business growth and smoother movement of goods across Nigeria.
source: Business day