By Seun Ibiyemi
The Centre for the Promotion of Private Enterprise (CPPE) has described the Federal Government’s 2026 fiscal policy measures as a bold step toward accelerating industrial growth, while warning of potential disruptions for businesses reliant on imports.
In a policy brief issued on Sunday, CPPE Chief Executive Officer, Dr. Muda Yusuf, said the reforms signal a clear transition from an import-driven economy to one anchored on domestic production and value addition.
The policy framework includes revisions to the Import Adjustment Tax (IAT) affecting 192 tariff lines, selective import restrictions, tariff cuts on critical industrial inputs, excise duty adjustments, and the introduction of a green tax on selected imported vehicles.
It also establishes a National List of 127 items mainly intermediate goods, eligible for concessional tariffs of between zero and 10 percent.
Dr Yusuf highlighted the increase in tariffs on a wide range of imported finished goods including food, textiles, plastics, and metal products—as a major feature of the reforms.
The tariffs, ranging from 20 to 70 percent, are expected to raise import costs and give domestic manufacturers a stronger competitive edge.
He noted that the policy would incentivise expansion in local manufacturing, promote backward integration, and encourage investment in import-substitution sectors such as agro-processing, packaging, and light manufacturing.
At the same time, Dr. Yusuf commended the reduction in tariffs on industrial inputs like machinery and chemicals, describing it as a strategic move to lower production costs and boost competitiveness within the manufacturing sector.
However, the think tank cautioned that import-dependent firms, particularly in trading and distribution, could face increased financial pressure.
Rising import bills are likely to lead to tighter margins, higher working capital needs, and possible declines in sales volumes.
He also expressed concern over the lack of strong fiscal protection for domestic petroleum refining, urging the government to introduce supportive tariff measures to consolidate recent investments and strengthen energy self-sufficiency.
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Dr. Yusuf further recommended a review of high tariffs on used vehicles, as well as reduced duties and tax waivers for mass transit buses and renewable energy equipment to ease transportation and energy costs for businesses and households.
Concluding, he said the success of the policy would depend on how well investors adapt to the changing environment, urging a shift toward production-focused investments, deeper local sourcing, and strategic partnerships to harness emerging opportunities in the evolving economy.
