CPPE Highlights Opportunities, Risks in 2026 Fiscal Policy Measures

The Centre for the Promotion of Private Enterprise (CPPE) has said Nigeria’s 2026 fiscal policy measures and tariff amendments signal a decisive shift toward strengthening domestic production, industrialisation, and reduced import dependence.
In a policy brief released on April 19, 2026, CPPE reviewed the Federal Government’s latest fiscal framework, noting that the reforms align with the country’s medium-term economic transformation agenda while presenting a mix of opportunities and risks for investors.
The measures include revisions to the Import Adjustment Tax covering 192 tariff lines, selective import restrictions, tariff reductions on key industrial inputs, excise duty adjustments, and the introduction of a green tax on certain imported vehicles. The policy also introduces a National List of 127 items—mainly intermediate goods and industrial inputs—eligible for concessional tariffs of between zero and 10 percent.
Boost for Local Manufacturing
CPPE identified increased tariffs on imported finished goods—ranging from 20 to 70 percent across sectors such as food, plastics, textiles, and metals—as a major highlight of the policy. According to the organisation, the move is expected to raise import costs and strengthen the competitiveness of domestic producers.
The development is projected to drive expansion in local manufacturing capacity, encourage backward integration across value chains, and stimulate investment in import-substitution industries. Sectors including agro-processing, light manufacturing, packaging, and basic metals are expected to benefit significantly, with improved capacity utilisation and stronger pricing power.
Lower Input Costs to Drive Industrial Growth
The policy also provides relief for manufacturers through reduced tariffs on machinery, chemicals, and other intermediate goods. CPPE said the National List offers a cost advantage that aligns with global best practices, enhancing competitiveness and supporting export readiness.
The organisation noted that the combination of higher tariffs on finished goods and lower tariffs on inputs reflects a coherent industrial strategy aimed at deepening value-chain integration and boosting investor confidence.
Challenges for Import-Dependent Businesses
Despite the positives, CPPE warned that import-dependent businesses—particularly in trading and wholesale distribution—could face significant challenges. Higher import costs are expected to increase working capital requirements, compress margins, and reduce sales volumes, potentially forcing business model adjustments.
The group also expressed concern over what it described as a relatively soft fiscal stance on petroleum product imports, arguing that stronger protection is needed to support domestic refining capacity and reduce foreign exchange pressures.
Policy Recommendations
CPPE called for targeted adjustments to strengthen the policy framework. It recommended introducing protective tariffs for locally refined petroleum products to safeguard investments and enhance energy security.
The organisation also urged a review of the current tariff regime on used passenger vehicles, particularly those with engine capacity of 2000cc and below. It noted that the effective tariff burden exceeds 50 percent, which could limit vehicle ownership, affect mobility, and constrain job creation in sectors such as ride-hailing and car hire.
Further recommendations include reducing tariffs on automotive assembly inputs—such as semi-knocked down and completely knocked down parts—to boost local vehicle production, as well as lowering import duties on mass transit buses to 5 percent with a full VAT waiver to ease transportation costs.
CPPE also advocated reduced tariffs on renewable energy equipment, including batteries and inverters, to improve access to reliable power for households and small businesses.
Investor Outlook
The policy think tank advised investors to realign their strategies in response to the shifting economic landscape. It urged a transition from trading to production-focused investments, deeper local sourcing, and stronger integration into domestic value chains.
According to CPPE, strategic partnerships, technology transfer, and cluster-based investments will be critical for maximising opportunities under the new regime.
Conclusion
CPPE described the 2026 fiscal policy measures as a bold step toward economic restructuring and resilience. While the reforms offer significant opportunities in manufacturing, agro-processing, recycling, and green industries, they also pose risks for import-dependent sectors.
The organisation concluded that investors who adapt to the domestic production agenda and align with Nigeria’s evolving industrial policy will be best positioned to benefit.
The policy brief was signed by CPPE Chief Executive Officer, Dr. Muda Yusuf.