Nigeria Customs suspends implementation of 4% FOB charge

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Suspension

By Martha Agas

The Nigeria Customs Service (NCS), has suspended implementation of the four per cent charge on the Free On-Board (FOB) value of imports.

The Spokesman of the service, Abdullahi Maiwada, made this known in a statement on Tuesday in Abuja.

According to him, the FOB charge is calculated based on the value of imported goods, including cost of goods and transportation expenses incurred up to the port of loading.

The News Agency of Nigeria (NAN) reports that the NCS on Feb.5 announced that it was implementing a four per cent charge on the FOB value of imports.

Maiwada said that the move was in line with the provision of Section 18 (1) of the Nigeria Customs Service Act (NCSA) 2023.

The announcement has received criticism from experts and stakeholders in the sector, who said the move would worsen the country’s inflation rate.

Dr Chinyere Almona, Director-General of the Lagos Chamber of Commerce and Industry, said the implementation was abrupt and lacked due consultation with stakeholders, as required by the provisions of the NCSA 2023.

The Spokesman said the suspension was sequel to ongoing consultations by Mr Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, with stakeholders.

He said the revised implementation timeline would be announced following the conclusion of the consultation.

He explained that the suspension period would allow the service to further engage with stakeholders while ensuring proper alignment with the Act’s provisions for the sustainable funding of its modernisation initiatives.

“This 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 one per cent Comprehensive Import Supervision Scheme (CISS).

“This presents an opportunity to review our revenue framework holistically, “ he said.

Maiwada explained that the previous funding arrangement which was repealed by the NCSA 2023, separated the one per cent CISS and the seven per cent cost of collection.

He said it created operational inefficiencies and funding gaps in customs modernisation efforts.

According to him, the new Act addresses the challenges by consolidating no less than four per cent of the Free-on-Board (FOB) value of imports to ensure sustainable funding for critical customs operations and modernisation initiatives.

He said the transition period would allow the service to optimise the management of these frameworks to better serve its stakeholders and the nation’s interests.

He said that NCS was already implementing several digital solutions, including the recently deployed B’Odogwu clearance system, which aims to automate trade operations and align the service with international standards.

He noted that stakeholders were already benefiting from the system, through faster clearance times and improved transparency.

He said the NCS remained committed to implementing the provisions of the Act in a manner that best serves stakeholders while fulfilling its revenue generation and trade facilitation mandate.(NAN)

Edited by Muhyideen Jimoh

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