Petrol subsidy costs might have soared to ₦53 trillion if not for President Tinubu's policy overhaul, says NRS chairman

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The Chairman of the Nigeria Revenue Service, Zacch Adedeji, has said Nigeria’s petrol subsidy bill could have “risen to about ₦53 trillion and the exchange rate weakened to ₦3,500 to the dollar if the subsidy had remained.”

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Adedeji made the claim in an exclusive interview on Channels Television’s Sunday Politics programme while defending President Bola Tinubu’s economic reforms.

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He described the removal of petrol subsidy as the best thing to have happened to Nigeria, saying the decision had contributed to the positive economic outcomes being recorded by the government.

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“All the good results that I will reel out soon come as a result of that courageous decision (subsidy removal). So, it is not a mistake; it is the best thing that has happened to this country. Subsidy was evil and had been with Nigeria for decades,” he said.

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Adedeji said Tinubu inherited an economy characterised by an unsustainable subsidy regime, an underperforming oil sector and a narrow tax base.

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He argued that retaining the subsidy would have placed a greater burden on the country’s finances, particularly amid pressures from the global energy market and the Iran crisis.

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According to him, the subsidy bill could have reached about ₦53 trillion, while the exchange rate could have risen to ₦3,500 to the dollar.

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The NRS chairman also defended the government’s exchange-rate reforms and urged Nigerians to assess the administration’s economic decisions without relying on emotions.

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He said those seeking to challenge the Tinubu administration ahead of the 2027 elections should explain how they would address the country’s economic challenges differently.

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“What the President deserves now is support and commendation for being a statesman and not a politician. Anybody who says he is coming (to contest as president), just ask them, ‘What will you do differently?’

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“Are they saying that it is wrong that we removed fuel subsidy? Are they saying that it is wrong that we unified the rate?” he asked.

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Tinubu announced the removal of petrol subsidy in his inaugural address on May 29, 2023, triggering a sharp increase in petrol prices and contributing to higher transportation, food and production costs.

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Tinubu had announced that “fuel subsidy is gone.”

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The policy has also contributed to increased government revenues and higher allocations to the three tiers of government through the Federation Account, while its impact on the cost of living has remained a major concern, the NRS boss noted.

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