Don’t suspend 4% FOB charge, cancel it, directors tell Customs

The Chartered Institute of Directors (CIoD) Nigeria yesterday added its voice to the recently suspended 4% charge on the Free on Board (FOB) value of imports by the Nigeria Customs Service (NCS), calling for policy reforms to safeguard Nigeria’s economic growth and competitiveness. The NCS had introduced the levy in accordance with the provisions of […]

The Chartered Institute of Directors (CIoD) Nigeria yesterday added its voice to the recently suspended 4% charge on the Free on Board (FOB) value of imports by the Nigeria Customs Service (NCS), calling for policy reforms to safeguard Nigeria’s economic growth and competitiveness.

The NCS had introduced the levy in accordance with the provisions of the Nigeria Customs Service Act (NCSA) 2023.

But it later suspended the implementation of the charge following public outcry from importers, manufacturers and other stakeholders.

However, Director-General/CEO of CIoD, Bamidele Alimi in a statement said, “Though it has been temporarily suspended, according to the NCS, for further engagements and consultation with stakeholders, if we go by the trend of public policy in Nigeria, government is usually somehow rigid and unwilling to review its stands. So we are not so sure that anything would change.”

• Ailing man dies fleeing as bandits kill four in Niger attack
• Ministries partner to boost fish production, others

He highlighted the implications of the charge to include increased Cost of Doing Business; stifling industrial development; inflationary pressure; Impact on Small and Medium Enterprises (SMEs).

Alimi said, “This additional levy significantly raises the cost of importing raw materials and finished goods.

“For businesses reliant on imported inputs, this charge exacerbates production expenses, thereby diminishing profit margins and competitiveness. Conversely, it could lead to an increase in cost of the end products, if the cost is passed on to the end user.”

He stated further that SMEs, “Which are vital drivers of economic development and job creation,” will be disproportionately affected.

“The additional financial burden could force many to scale down operations or shut down entirely,” he added.

The CIoD however called on the federal government to “Reassess the 4% FOB charge to evaluate its long-term implications on trade, industry, and the overall economy.”

It recommended that policies should be implemented to support industries reliant on imported inputs, such as duty waivers for key manufacturing sectors.

The statement added, “Customs procedures should be optimised to reduce bureaucratic bottlenecks and corruption. Technology should be exploited more to reduce human interface.

“The CIoD Nigeria believes that while revenue generation is critical, it should not come at the expense of economic growth and development.

“The 4% FOB charge on imports poses significant risks to Nigeria’s industrialisation agenda and economic stability. We urge the federal government to reconsider this policy and adopt measures that promote trade, foster industrial growth, and enhance Nigeria’s global competitiveness.”