Customs halts 4% FOB charge implementation

• Published On: 12 February 2025 at 20:25

The Nigeria Customs Service has suspended the implementation of the 4% Free-on-Board value charge on imports, as specified in Section 18(1)(a) of the Nigeria Customs Service Act (NCSA) 2023.

In a statement signed by Assistant Comptroller of Customs and National Public Relations Officer Abdullahi Maiwada, the NCS stated that the decision was reached after extensive consultations with Finance Minister and Coordinating Minister of the Economy Olawale Edun, as well as other key stakeholders.

The suspension allows for additional consultation with stakeholders to improve the Act's implementation framework.

This policy shift occurs as contract agreements with service providers such as Webb Fontaine expire, which were previously funded through the 1% Comprehensive Import Supervision Scheme.

Previously, separating the 1% CISS from the 7% cost of collection resulted in inefficiencies and funding gaps in customs modernisation.

The NCSA 2023 intends to address this by consolidating funding, allowing "not less than 4% of the Free-on-Board value of imports."

The framework aims to develop a long-term funding mechanism for customs operations, technological upgrades, and modernisation.

During the suspension, the NCS will focus on improving revenue management while remaining aligned with national economic goals and trade facilitation.

The NCSA 2023 empowers the Nigeria Customs Service to modernise through technology.

Section 28 requires the creation and maintenance of electronic systems to facilitate information exchange among the NCS, government agencies, and traders.

As part of its digital transformation, the NCS has implemented a number of innovations, including the recently deployed B'Odogwu clearance system, which has reduced clearance times and increased transparency in the import process.