Implementation of 5% User Charge: Committees Inaugurated to Drive Compliance with FERMA Act

The House of Representatives has inaugurated two technical committees—Pre-Tax Act and Post-Tax Act Committees—to formalize the implementation of the 5% User Charge on petroleum products and diesel, in line with the provisions of the Federal Roads Maintenance Agency (FERMA) Act, 2007.

The committees, inaugurated on 8th July 2025, are tasked with developing clear procedures for the collection, remittance, and disbursement of the User Charge. They will also define roles for relevant government agencies, recommend operational structures for managing beneficiary accounts, and identify any legislative or policy gaps requiring attention.

The Pre-Tax Act Committee is chaired by Engr. Bernard Olisa (FERMA), while the Post-Tax Act Committee is led by FERMA’s Managing Director/CEO, Engr. Chukwuemeka Agbasi. Members include representatives from FERMA, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the Nigeria Revenue Service (NRS), and key industry stakeholders such as IPMAN, PETROAN, and NARTO.

The 5% User Charge is a statutory funding mechanism designed to support the maintenance and rehabilitation of federal roads across Nigeria. Its implementation is not intended to affect pump prices but to ensure safer, more accessible roads and provide hazard insurance for stakeholders in the petroleum distribution chain.

Recommendations from the committees are expected by 14th July 2025.