CPPE: Nigeria’s 2026 fiscal measures to spur industrial growth, test import-based businesses

THE Centre for the Promotion of Private Enterprise (CPPE) has said the Nigerian government’s 2026 fiscal policy measures signal a clear shift toward strengthening local industry and reducing dependence on imports, while posing transition risks for import-driven firms.

In a policy review signed by its Chief Executive Officer (CE0), Dr Muda Yusuf, and released on April 19, the group noted that the new framework reflects a strategic repositioning of the economy in line with medium-term industrialisation goals. The measures include changes to the Import Adjustment Tax (IAT) spanning 192 tariff lines, selective import restrictions, excise duty revisions, and the introduction of a green tax on certain categories of imported vehicles.

The policy also features a National List of 127 items, primarily intermediate goods and industrial inputs, subject to reduced tariffs of between zero and 10 percent to improve manufacturing competitiveness.

Local industry set to gain

CPPE identified higher tariffs on imported finished goods as a central pillar of the reforms. Duties on products such as food, textiles, plastics, and metals now range between 20 percent and 70 percent, raising the cost of imports.

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According to the organisation, this development is expected to strengthen domestic producers by improving their competitive position and encouraging investments in local manufacturing, backward integration, and import substitution.

It added that sectors including agro-processing, light manufacturing, packaging, and basic metals are likely to benefit from increased capacity utilisation and improved margins.

Lower input tariffs support production

The group said reductions in tariffs on industrial inputs, including machinery, chemicals, and intermediate goods, highlight a deliberate effort to reduce production costs.

This dual approach of taxing finished goods while easing input costs, CPPE noted, reflects policy coherence and aligns with global industrialisation strategies aimed at boosting local production and export readiness.

Import-dependent firms face pressures

Despite the potential gains for manufacturers, CPPE warned that businesses reliant on imports, especially in trading and wholesale distribution, may face significant challenges.

Higher import bills are expected to increase working capital requirements, compress margins, and weaken demand, prompting many firms to rethink their business models as the policy shift takes hold.

The organisation also expressed concern over limited fiscal protection for domestic refining, noting that stronger support is needed to sustain recent investments and reduce pressure on foreign exchange (FX).

Policy recommendations

CPPE called for targeted refinements, including the introduction of tariff protection for locally refined petroleum products to support energy security and investment.

It also urged a review of tariffs on used passenger vehicles, recommending a reduction to ease mobility constraints and support employment in transport-related sectors. Additional recommendations include lower duties on automotive components to boost local assembly, reduced import costs for mass transit buses, and tariff cuts alongside VAT waivers for renewable energy equipment such as batteries and inverters.

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Investment outlook

The organisation said the policy direction sends a strong signal that Nigeria is moving away from an import-driven model toward a production-led economy.

It advised investors to align with this shift by focusing on domestic production, strengthening local supply chains, and targeting sectors supported by the new tariff regime.

Conclusion

CPPE said the 2026 fiscal measures represent a bold step toward economic restructuring and resilience, offering significant opportunities in manufacturing and related sectors, while requiring careful adjustment from import-dependent businesses.