allAfrica.com: Nigeria: Our Import Duties Are Punitive, Reduce Them, NPA, Customs Tell FG (Page 1 of 2)

The Nigerian Customs Service, (NCS) and the Nigerian Ports Authority (NPA) have called on the federal government to reduce the high tariff regime in the industry or risk the continued decline of revenue accruable from importation.

The duo expressed regret that the high tariff regime has multiple effects of not only crippling the economy, but also fuels high cost of goods and services and puts down the Customs revenue contributions to the federation accounts.

Meanwhile operators in the Nigerian Maritime sector had over the years been expressing worries over a situation where more than 75 per cent of the total imports into the West African Sub-region reportedly favour the Nigerian market, but only insignificant proportion of the same imports come in through any of the country's eight seaports and approved boarders.

This ugly trend had been attributed to very high cost of clearing goods at the Nigerian ports, even in the face of gross inefficient port system, and this has always compelled importers to route their consignment through neighbouring seaports and only tranship to Nigeria, resulting into a total loss to the government.

This issue was a priority discussion as members of the House of Representatives Committee on Privatisation, recently visited the Nigerian Ports Authority.

The Managing Director of the Nigerian Ports Authority (NPA) Mallam Abdulsalam Mohammed, explained that the age-long problem of diversion of imported goods meant for the Nigerian economy through other seaports of neighbouring African Countries was as a result of high cost of operation. He described the issue of cargo diversion as technical, stating that it occurs as a results of high customs tariff regime.

According to him, "those importers that divert their consignments do so to reduce the amount of import duty paid on a particular good and thereby end up smuggling in the good into the country. For instance, some Nigerians smuggle vehicles of more than eight years, which the government had outlawed, into the country through other neighbouring African Seaports and later drive same into Nigeria by road.

The same thing happened on the illegal importation of furniture, and many other prohibited goods. What the importers are doing is to cut corners because the tariff is high. I am not suggesting that the nation's seaports should be very cheap compared to some of their peers in the west and Central African sub-region, but let us look towards finding an avenue where the revenue for the nations would not be totally lost, because our importers find it too exorbitant to pay."

He however observed that the completion of the port reforms programme and subsequent hand over of the ports for the various terminal operators has invariable produced efficiency and would bring as well cost reduction on the long run.

In the same vein, the Assistant Comptroller General of the Nigerian Custom Service (NCS) Alhaji Sani Nuhu Abubakar recently condemned the high tariff and the federal government fiscal policy. Nuhu, who spoke on behalf of the Comptroller General of Customs, Elder Jacob Buba at a forum for policy dialogue on Custom and Port Reforms in Lagos during the week stated that Nigerians will continue to be non compliant to tariff policy even as the customs will continue to be corrupt as long as the current platforms prevails.

"The fundamental issue which needs to be addressed if Nigerians desire to make any meaningful progress in generating the revenue from imports and suppression of smuggling, is its trade policy. No country on earth has our kind of trade and fiscal policy. Our tariffs are totally punitive and sometimes I ask if they are meant for people on this planet.

The Nigerian importers divert their cargo to Cotonou to discharge because the tariff regime there is friendly and tolerable. 78 per cent of cargo passing through NAHCHO are illegal import. It is either that they are false fully declared or they are concealed and not declared at all. This is because the tariff regime is hostile. What is important and what will move this nation forward, is telling our selves the plane truth for onces," he fummed.

Speaking on the prohibited items, Nuhu pointed out that Nigeria needs to jettison the archaic idea of banning some consumed goods. "The ban of goods especially the ones that are scarcely produced here enable smuggling activities to thrive. High tariff or ban on importation never assisted local manufacturer at all. Over protection even if it is of your child will produce an indolent child.

Why do we insist on protecting what we don't have? Who are we protecting? Last year Philippines collected $49 billion as customs duty. With all our high tariffs and banning, we never collected more than $3 billion in Nigeria. 90% of vegetable oil brought into Nigeria comes illegally. Government is losing enormous revenue on vegetable oil because it is banned.

The Desination Inspection scheme is upside down because of the nation's hostile fiscal policy. Take for instance, rice has 50% duty, 50% levy, this is punitive. But these goods land at Cotonou where tariff are friendly and eventually find their way into the country", he added.

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