- The Nigeria Customs Service says the six-month import duty waiver on staple foods will cost the country N188.37 billion in revenue
- Comptroller-General of the NCS said the service’s operations are being adjusted to achieve the policy
- The import duty waiver is part of the Federal Government’s efforts to ensure food availability and address soaring inflation
The Nigeria Customs Service (NCS) says the suspension of six-month tariffs and import duties on staple foods (rice, wheat, maize and sorghum) could cost the Federal Government an estimated N188.37 billion in revenue.
According to the NCS computation, a total of N3.819 trillion was spent as total import of staple foods between 2020 and 2023, while the commodities generated N191.715 billion in customs duty and N561.775 billion in levies paid to the government.
Bashir Adewale Adeniyi, Comptroller-General of the NCS, stated this on Tuesday, August 13, in an address on ‘Facilitating Food Trade Through Efficient Customs Process: Best Practices for Nigeria,’ delivered at the second Economic Confidential Lecture and book presentation in Abuja.
Adeniyi said the suspension of tariffs and import duties on these commodities for the next six months is a considerable revenue sacrifice.
He said, “Let me put this into perspective with some data. From 2020 to 2023, the total import of these food items (beans, maize, rice and wheat) was a staggering N3,819,516,677,584.00. During this period, these commodities generated N191,715,743,625.55 in customs duty and N561,775,629,251.70 in levies paid to the government.
“To break this down further, wheat alone accounted for N3,784,288,508,393.00 in import value, generating N189,214,425,419.65 in duty and N561,678,613,107.90 in levy. Maize imports were valued at N34,301,422,247.00, contributing N2,335,515,156.60 in duty.
“Rice, despite import restrictions, saw N195,463,395.00 in import value, yielding N19,546,339.50 in duty and N97,016,143.80 in levy. Beans imports were valued at N731,283,549.00, contributing N146,256,709.80 in duty.
“These figures highlight the significant revenue implications of the new policy. Projecting based on recent trends, we estimate that the six-month tariff suspension could result in a revenue forfeiture of approximately N188.37 billion.”
‘We will adjust operations to achieve the policy’
Adeniyi also noted that the NCS is committed to achieving the policy and is in the process of adjusting its operations to ensure smooth implementation of the guideline.
He noted that the tariff suspension will likely lead to a surge in food imports and the NCS must prepare for the increased volume, ensuring that the ports and border stations are equipped to handle the uptick without delays.
“Our goal is to effectively support the government’s food security initiatives while maintaining the integrity of our borders and trade processes. We are implementing a multifaceted approach that encompasses policy alignment, operational efficiency, technology adoption and stakeholder engagement.
“First and foremost, we are fully committed to supporting and implementing the guidelines on tariff removal that will be issued by the Ministry of Finance in the coming days.
“Our teams are supporting the development of the guidelines and will swiftly integrate these guidelines into our systems and processes to ensure seamless implementation as soon as they are released. This proactive stance will minimise any potential delays or confusion in the clearance process for the affected food items,” the Customs boss said.
Tax waiver part of FG’s policies to fight food inflation
Recall that the NCS had said it would commence the implementation of import duty waiver on some food items this week.
It attributed the delay in the implementation of the policy as announced by the Federal Government to the late release of guidelines from the Federal Ministry of Finance.
The Federal Government recently announced the suspension of import duties and taxes on essential food items for 150 days to address skyrocketing inflation.
To also cushion the effects of some policies that contributed to soaring food prices, the government also dispatched 740 rice trucks to states at 20 trucks for each of the 36 states and the Federal Capital Territory, Abuja.
Rising food prices push headline inflation rate to 34.19%, food inflation to 40.87 %
Meanwhile, TheRadar reported that the increasing prices of food pushed Nigeria’s headline inflation rate to a new 28-year high of 34.19 per cent in June 2024.
According to data released by the National Bureau of State Statistics (NBS) on Monday, July 15, the June rate is 0.24 percentage points higher than the 33.95 per cent recorded in May 2024.
