FG Passes New Green Tax On Large-engined Luxury SUVs And High-performance Sports Cars

Federal Government passes new green tax on large-engined luxury SUVs, high-performance Sports Cars and trucks. 

Approved on April 1, the new levy, which takes effect on July 1, ​is part ‌of ⁠a wider package of 2026 fiscal policy changes. 

New levy apply to ​vehicles with engine sizes of 2,000cc to ⁠3,999cc at a rate of 2%, ​while engines of 4,000cc and ​above will face a 4% charge.

Exempted are vehicles with engines below 2,000cc, mass transit buses, electric vehicles and locally manufactured vehicles.

The Federal Government has introduced a new green tax surcharge on ​motor vehicles with engine sizes above 2,000cc (2-liter), a government circular seen by Reuters showed.

Approved on April 1, the new levy, which takes effect on July 1, ​is part ‌of ⁠a wider package of 2026 fiscal policy changes approved by President Bola Ahmed Tinubu, alongside revised import tariffs on passenger vehicles from 70% to 40%.

According to the document, the new levy apply to ​vehicles with engine sizes of 2,000cc (2-liter) to ⁠3,999cc at a rate of 2%, ​while vehicles with engines of 4,000cc (4.0L) and ​above will face a 4% charge, the document showed.

Exempted from the new levy includes vehicles with engines below 2,000cc, mass transit buses (public transportation vehicles), battery-electric vehicles (BEVs) and locally manufactured vehicles.

The circular also granted a 90-day grace period for ​importers, manufacturers and service providers before ​the ⁠implementation of the new excise duty rates in the broader package.

Vehicles with 4,000cc (4.0L) engines range from luxury SUVs like Toyota Land Cruiser, Lexus LX and Range Rover to high-performance sports cars from brands like Ferrari and Lamborghini. Reliable, heavy-duty commercial vehicles also fall into this category.

• See Also : FG Cuts Import Duties On Passenger Vehicles, EVs And Mass Transit Buses To Curb Inflation