Customs suspends implementation of 4% FOB levy

The Nigeria Customs Service (NCS) has suspended the implementation of a 4 percent charge on the free-on-board (FOB) value of imports.

In a statement on Tuesday, Abdullahi Maiwasa, assistant comptroller of NCS, said the suspension will enable comprehensive stakeholder engagement and consultations regarding the implementation framework.

Maiwasa said the decision aligns with Section 18(1)(a) of the Nigeria Customs Service Act (NCSA) 2023, which outlines the charge’s legal framework.

He added that the move follows ongoing consultations with Wale Edun, the minister of finance and coordinating minister of the economy.

“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% Comprehensive Import Supervision Scheme (CISS),” Maisawa said.

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

“Under the previous funding arrangement repealed by the NCSA 2023, separating the 1% CISS and 7% cost of collection created operational inefficiencies and funding gaps in customs modernisation efforts.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% 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.”

Maiwasa also said the Act further empowers customs 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,” he said.

“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 authorised 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)).”

On February 5, the NCS announced it will implement a 4 percent charge on the FOB value of imports.