Economist Samuel Ayininuola has raised concerns over the federal government’s proposed green tax, arguing that while it is framed as an environmental policy, its primary effect will be revenue generation rather than meaningful climate impact.
Speaking during an interview on ARISE News on Monday, Ayininuola said the policy reflects an attempt to integrate environmental considerations into fiscal policy, in line with global standards, but questioned its real-world effectiveness in Nigeria’s current context.
“I see this as just a way of raising additional revenue for the government,” he said.
According to him, the environmental benefits of the tax are likely to be limited, as it mainly targets high-end vehicle users who are less sensitive to price increases.
“The main people who use those SUVs and luxury vehicles will still continue to buy them,” he noted, adding that only marginal buyers may be discouraged.
Ayininuola also highlighted structural challenges that could undermine the policy’s success, particularly Nigeria’s weak industrial base and inadequate infrastructure for electric vehicles.
“Even we, as human beings, we don’t have electricity. So where are we going to charge electric vehicles?” he asked.
He warned that implementation would be difficult, citing issues around vehicle classification, enforcement, and the lack of clarity on how hybrid vehicles would be treated under the policy.
Beyond environmental concerns, Ayininuola emphasized the broader economic implications, noting that increased import costs would likely be passed on to consumers, worsening the already high cost of living.
“There is no way this will not indirectly affect the consumers,” he said.
He added that while the tax may help improve Nigeria’s low tax-to-GDP ratio, it could also contribute to inflationary pressures in the economy.
Despite these concerns, Ayininuola acknowledged that the policy could, over time, encourage investment in renewable energy and local vehicle manufacturing if supported by the right incentives.
He stressed the need for government-backed support mechanisms, including financing, tax credits, and infrastructure development, to make environmentally friendly investments viable.
“If we build up on this… it will encourage people to look at the environment,” he said.
However, he maintained that without strong implementation and supporting policies, the green tax risks falling short of its environmental objectives while placing additional economic strain on Nigerians.
By Ojo Triumph
