The Nigeria Customs Service (NCS) has been directed to commence the enforcement of a new policy that implements zero per cent import duty and exempts Value-Added Tax (VAT) on basic food items, following approval from President Bola Tinubu.
The Ministry of Finance confirmed the approval in a letter to the NCS dated August 8, 2024. This development was further verified by the NCS in a document shared on Wednesday.
In response to the directive, the Comptroller-General of the NCS, Bashir Adeniyi, instructed officials to begin immediate enforcement of the policy. The NCS issued a circular titled “Approval for the Implementation of Zero Per Cent Duty Rate on Basic Food Items,” detailing the Ministry of Finance’s directive.
The circular, signed by Deputy Comptroller-General C.K. Niagwan, specified that the zero per cent duty and VAT exemption applies to certain food commodities, including maize, husked brown rice, wheat, grain beans, and millet. The policy is effective from July 15 and will run until December 31, 2024. It is limited to these specified items and applies only to importers with milling capacity and a verifiable Backward Integration Programme (BIP).
The circular also noted that the Federal Ministry of Finance would periodically provide the NCS with a list of approved importers and their quotas throughout the implementation period to ensure compliance.
“The Federal Ministry of Finance shall, from time to time during the implementation period, furnish the Nigeria Customs Service with the list of importers and their approved quotas to guide the importation of the basic food items. Ensure wide circulation for strict compliance, please,” the letter read.
This policy move follows the Federal Government’s July 10 announcement of a suspension of duties, tariffs, and taxes on the importation of food staples through land and sea borders, aiming to curb rising inflation. On August 7, the NCS indicated that the duty waiver on imported food items would be implemented within a week.
The finance minister, Wale Edun, emphasized that the measure is designed to alleviate the high cost of food items in Nigeria and will be limited to addressing the national supply gap. He also highlighted that importers applying for the duty waiver must have milling capacity and a verifiable BIP, which involves sourcing raw materials locally to reduce dependency on foreign imports.
However, the Comptroller-General of the NCS, Bashir Adeniyi, noted that the government is expected to lose approximately N188 billion in revenue due to the suspension of import duties on these food commodities. Despite this, the NCS is committed to ensuring the policy is effectively implemented by establishing special corridors for clearing imports of food items.
