Nigeria Customs: Food Import Duty Waiver will Cost FG N188bn

Arthur Eriye

The Nigeria Customs Service (NCS) has disclosed that the federal government may forgo N188.37 billion in revenue over the next six months due to the duty waiver granted on the importation of staple foods.

Additionally, the NCS revealed that Nigeria spent N3.82 trillion on importing wheat, beans, rice, and maize between 2020 and 2023.

The Comptroller-General of the NCS, Adewale Adeniyi, who spoke during a press conference in Abuja, emphasised that the revenue forfeiture demonstrates the government’s commitment to prioritising food security over short-term revenue goals.

On July 8, 2024, the Federal Government announced a 150-day duty-free import window for food commodities to ensure a reduction in food inflation in Nigeria. The food commodities include maize, husked brown rice, wheat, and cowpeas.

The government also collaborated with states to expand land cultivation across the country.

Consequently, the government suspended duties, tariffs, and taxes for the importation of certain food commodities through land and sea borders.

Giving updates on the directive, Adeniyi explained that the government’s initiatives, while crucial for addressing the nation’s food security challenges, have significant implications for the customs service.

According to him, as the agency responsible for trade facilitation and revenue collection at the borders, the NCS finds itself at the intersection of these policies and their practical implementation.

He pointed out that the most immediate and substantial implication is the revenue forfeiture, as the government has committed to making food more accessible and affordable for its citizens.

“The removal of tariffs and import duties on key staples, rice, wheat, maize, and sorghum (beans) for the next six months represents a considerable sacrifice in terms of potential revenue. Projecting based on recent trends, we estimate that the six-month tariff suspension could result in a revenue forfeiture of approximately N188.37billion,” Adeniyi said.

Analysing this, he explained that from 2020 to 2023, the total import of these food items, including beans, maize, rice, and wheat, was N3.82trillion

“During this period, these commodities generated N192 billion in customs duty and N562 billion in levies paid to the government,” the CGC said.

The customs boss added that wheat alone accounted for N3.78trillion in import value, generating N189 billion as duty and N561 billion as levy.

“Maize imports were valued at N34.3 billion, contributing N2.3 billion in duty. Rice, despite import restrictions, saw N195million in import value, yielding N19million in duty and N97million in levy. Beans imports were valued at N731million contributing N146million in duty,” Adeniyi stated.

Meanwhile, Adeniyi stated that the Compressed Natural Gas initiative of the President, while not related to food, would reduce transportation costs by approximately 60 per cent.

“This could indirectly but significantly benefit food security by potentially lowering food transportation costs, making food more affordable across the country,” he said.