The Nigeria Customs Service (NCS) has announced the suspension of the implementation of the 4 percent Free-on-Board (FOB) value on imports as provided in Section 18(1) (a) of the Nigeria Customs Service (NCSA) 2023.
According to Customs, the suspension results from the ongoing consultations with Olawale Edun, minister of Finance and Coordinating Minister of the Economy and other Stakeholders.
In a statement signed by Abdullahi Maiwada, assistant Comptroller of Customs, and National Public Relations Officer on behalf of Comptroller-General of Customs, the suspension will enable comprehensive stakeholder engagement and consultations regarding the Act’s implementation framework.
The statement reads that 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 percent Comprehensive Import Supervision Scheme (CISS).
It further states that this presents an opportunity to review our revenue framework holistically.
“Under the previous funding arrangement repealed by the NCSA 2023, separating the 1 percent CISS and 7 percent cost of collection created operational inefficiencies and funding gaps in customs modernisation efforts. The new Act addresses these challenges by consolidating “not less than 4 percent of the Free-on-Board value of imports,” designed to ensure sustainable funding for critical customs operations and modernisation initiatives”.
This transition period will allow the Service to optimise the management of these frameworks to serve our stakeholders and the nation’s interests better. The Act further empowers the Service to modernise its operations through various technological innovations. Specifically, Section 28 of the NCSA 2023 authorises developing and maintaining electronic systems for information exchange between the Service, Other Government Agencies, and traders. The Service is already implementing several digital solutions, including the recently deployed B’Odogwu clearance system, which stakeholders are benefiting from through faster clearance times and improved transparency. Other innovative solutions authorized by the Act include; Single Window implementation (Section 33), Risk management systems (Section 32), Non-intrusive inspection equipment (Section 59) and Electronic data exchange facilities (Section 33(3)),” the customs stated.
In the statement, Customs further explains that the suspension period will allow the Service to engage with stakeholders further while ensuring proper alignment with the Act’s provisions for sustainable funding of these modernisation initiatives.
It assures that NCS remains committed to implementing the provisions of the Act in a manner that best serves our stakeholders while fulfilling our revenue generation and trade facilitation mandate.
“We will communicate the revised implementation timeline following the conclusion of stakeholder consultations,” the statement adds.
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