Customs seek review of 0% finished pharmaceuticals duty, 35% auto policy

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Comptroller General of Customs, Hameed Ali (right) and Dr. Boniface Aniebonam, Founder of National Association of Government Approved Freight Forwarders at a recent function in Lagos

By Adegboyega Oni

Nigeria Customs Service has called for an urgent review by the Federal Government of the HS code 39 which places a zero percent duty on finished pharmaceutical products while raw materials for local production of pharmaceuticals attract 5 percent duty.

Customs also demands a review of the 35% levy in the new auto policy which it considers prohibitive and counterproductive and describes as a leeway for smuggling and the neighboring countries economies to thrive while shortchanging Nigeria in billion of Naira yearly.

These formed part of the submissions of the Assistant Comptroller General (ACG) of Customs and Controller of Zone A of the Nigeria Customs Service, Kaycee Ekekezie, in a paper she presented at the maiden annual Maritime Week organized by Post Graduate Maritime Students Association of the Institute of Maritime Studies, University of  Lagos.

”There is need to make the nation’s export procedure less cumbersome with few documentations.”

Ekekezie noted that economies that operate fiscal policy measures with lowered rates of duties have proven to attract higher volumes (turnover) of transactions and government revenue from imports, saying that such policy measures also make economies attractive to trade.

She maintained that in view of the recent diversion of cargo to neighbouring countries, the 35% levy in the new auto-policy needs to be reviewed to discourage diversion.

”Fiscal policy measures like lowered rates of duties have proven to attract higher volume (turnover) of transactions and government revenue from imports. Such policy measures also make economies attractive to trade. In view of the recent diversion of cargo to neighbouring countries, the 35% levy in the new Auto-policy need to be reviewed considering the fact we operate the same tariff with our neighbouring countries, but in their own case they do not charge levies.  This will discourage the incentive to divert cargo to such countries,” stated Ekekezie.

To further stimulate the economy, she said the Customs management expects government’s fiscal policy to give due consideration to items that dominate import into Nigeria and favourable fiscal policies on industries that account for much of the revenue, create job opportunities and tax.

According to her, infrastructure in and around ports should be upgraded to facilitate trade and customs operations while customs revenue should be deployed  to small and medium scale industries to encourage investment in such areas of the economy.

Speaking on infrastructure provision, Ekekezie noted that the expected contribution of Nigeria Customs Service (often above 15.0%) to the national budget will enhance government’s capacity and commitment to provide adequate infrastructure various sectors the economy.

”For example, the volume of vehicles that feature in the nation’s import data underscores the need for investment in road infrastructure and mass transit programmes. The Service also expects the expansion of existing port infrastructure or the development of new ones to accommodate eventual increase in the nation’s cargo through put,” she said.

The Assistant Comptroller General called on stakeholders to support the renewed effort by the Customs management to present a new bill on the review of the Customs & Excise Management Act (CEMA) to enable the application of modern tools and techniques in the performance of the Customs NCS statutory responsibilities.

In the area of security, ACG Ekekezie assured that the Service would intensify interdiction of arms and ammunition at various entry points into the country as it would share intelligence with other security agencies in the country.

On challenges being faced by the Customs on cross border management, she averred that globalisation has increased volumes of trades and complexities of international trade, increased cross border security threats and organised crime.

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