The Federal Government has officially approved the implementation of the 2026 Fiscal Policy Measures (FPM), introducing comprehensive changes to import tariffs designed to stimulate economic growth across critical sectors. This landmark approval was conveyed in a document dated April 1, 2026, and signed by the Minister of Finance, Wale Edun, effectively replacing the 2023 FPM. The overarching goal of these reforms is to strike a balance between revenue generation and economic stimulation, while simultaneously supporting local industries and easing the cost of crucial imports.

A major highlight of the new policy is a thorough review of import duties across 127 tariff lines, covering a diverse range of items from essential food products like rice and sugar, to vehicles and key industrial inputs. The government emphasized that these reductions are strategically designed to "promote and stimulate growth in critical sectors of the economy," fostering a more balanced and market-driven trade environment.

Significant adjustments have been made across various sectors. In the automotive industry, tariffs on fully built passenger vehicles, which include four-wheel drives and station wagons, have been substantially reduced from 70 percent, as stipulated in the 2015 FPM, to a new rate of 40 percent. This aims to make vehicles more affordable and potentially boost demand.

The agricultural and food sectors will also experience notable tariff changes. The Import Adjustment Tax (IAT) on crude palm oil has been set at a total effective rate of 28.75 percent, a reduction from previous higher rates. Tariffs on rice in bulk or packaging over 5kg have dropped to 47.5 percent from 70 percent, and broken rice to 30 percent from 70 percent. Raw cane sugar now attracts a 55 percent duty (down from 70 percent), while processed cane/beet sugar in powder or granule form is set at 57.5 percent (also down from 70 percent). Refined salt has seen its tariff reduced to 55 percent from 70 percent. Other specific adjustments include wheat or meslin flour at 70 percent and margarine (excluding liquid) at 40 percent, alongside antimalarial medicaments set at 20 percent.

Industrial inputs, vital for manufacturing and development, have similarly benefited from tariff cuts. Zinc-coated steel sheets, aluminum-coated steel coils, electroplated steel, hot-rolled deformed steel bars, and steel rods (between 5.5mm and 14mm) have all been reduced to 35 percent from their previous rate of 45 percent. Cold-rolled steel with less than 0.25 percent carbon is now set at 15 percent. Ceramic products also see reductions: unglazed ceramic tiles to 35 percent from 40 percent, glazed ceramic tiles to 46.25 percent from 55 percent, and ceramic cubes smaller than 7cm to 35 percent from 40 percent. Additionally, tariffs on envelopes are reduced to 40 percent from 50 percent, and diaries/notebooks to 30 percent from 40 percent.

Further easing the cost of critical imports, several categories have been granted zero-duty status, primarily benefiting key infrastructure and essential services. These include railway and tramway locomotives (SKD/CKD), cargo ships exceeding 500 tonnes, breathing appliances and gas masks, and agricultural and manufacturing machinery, all previously at 5 percent. Other significant reductions encompass modular surgical operating theaters to 5 percent from 20 percent, air/vacuum pumps and compressors to 5 percent from 10 percent, and various electrical apparatus such as fuses, automatic circuit breakers, and lamp holders, all reduced to 10 percent from 20 percent.

To ensure a smooth transition, the government has granted a 90-day grace period for importers who opened Form ‘M’ before April 1, 2026, allowing them to clear their goods at the old, pre-existing rates. However, additional fiscal changes are on the horizon, with a new excise duty regime and a green tax surcharge both scheduled to take effect from July 1, 2026.

The policy also clearly outlines categories exempted from the upcoming green tax surcharge. These exemptions apply to vehicles below 2000cc, mass transit buses (under heading 87.02), electric vehicles, and locally manufactured vehicles falling under specified headings (87.06–87.13). These exemptions are intended to encourage environmentally friendly transport and support domestic manufacturing capabilities.

Overall, these measures represent a concerted effort by the government to foster a more competitive and stable economic environment, supporting domestic production and protecting economic stability while attracting investment through a revised, growth-oriented tariff structure.