By Suleiman Anyalewechi
The Nigeria Customs Service NCS, on Tuesday February 11, announced the suspension of the implementation of 4% Free-on-Board, FOB, tax on imports.
The Source reports that the duty rate scheduled to come into force in the 2025 fiscal year has been facing mounting criticisms and opposition from not a few industry stakeholders.
Importers fear that the duty regime will further worsen the already hard economic situation in the country by driving up prices of commodities.
A statement from the National spokesperson for the NCS, Abdullahi Maiwada ACC, said the suspension stemmed from the ongoing consultations with the Minister of Finance and Coordinating minister of the Economy, Wale Edu and industry stakeholders.
According to Maiwada, the consultation exercise will involve a comprehensive engagement regarding the implementation framework.
“The Nigeria Customs Service, NCS, hereby announces the suspension of the implementation of 4% Free-on-Board FOB value on imports as provided in section 181(1)(a)of the Nigeria Customs Service Act NCSA 2023 .
“This is sequel to ongoing consultations with the Hon. Minister of Finance and Coordinating Minister of the Economy, Mr Olawale Edun, and other stakeholders.
“The Suspension will enable comprehensive stakeholder engagement and consultations regarding the Act’s implementation framework.
“The timing of this suspension aligns with the exit of the contract agreement with the Service providers, including Webb Fontaine, which were previously funded through the 1% comprehensive Import Supervision Scheme, CISS .
“This present an opportunity to review our revenue framework holistically.
“Under the previous funding arrangements repealed by the NCS 2023, separating the 1% CISS and 7% cost of collection created operational inefficiencies and funding gaps in Customs modernization efforts.
“The new Act address these challenges by consolidating not less than 4% of the Free-on-Board value of imports designed to ensure sustainable funding for critical customs operations and modernization initiatives”, the NCS stated
According to the NCS spokesman, this transition period will allow the service to optimize the management of the frameworks to serve stakeholders and the nation better.
Further speaking, he noted that the Custom Act empowers the service to modernize its operations through various technological innovations.
“Specifically, section 28 of of the NCSA 2023 authorizes developing and maintaining electronic systems for information exchange between the Service, other Government agencies, and traders
“The suspension period will allow the Service to further engage with stakeholders, while ensuring proper alignment with the Act’s provisions for sustainable funding of these modernization initiatives”, part of the statement reads .
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