… Says high customs duty can lead to several negative consequences
The National President of the Africa Association of Professional Freight Forwarders and Logistics of Nigeria, APFFLON, Otunba Frank Ogunojemite has faulted the N12 trillion revenue target set for Nigeria Customs Service, NCS by the National Assembly describing it as an ill-advised recommendation.
Recall that the National Assembly through its Joint Committee on Finance significantly increased the 2025 revenue projections for the Nigeria Customs Service, NCS during a budget defence session in Abuja, raising the NCS’s initial revenue target from N6.5 trillion to a bold N12 trillion.
The Comptroller-General of the Nigeria Customs Service, Bashir Adewale Adeniyi, had earlier presented a projection of N6.5 trillion for 2025, following a robust performance in 2024, where NCS generated N6.1 trillion.
However, the committee, led by Senator Sani Musa and Hon. James Faleke, deemed the projection insufficient given the NCS’s potential.
Speaking in his birthday message, Ogunojemite reminded the National Assembly that beyond the huge revenue collection by Customs which increases year-on-year, several Nigerian businesses were being crippled while the ordinary citizens suffer from inflated costs of services and products which had been imported and mandated to pay high Customs duties.
He observed that high customs duty in Nigeria could lead to several negative consequences, including increased cost of imported goods for consumers, hindering business growth, discouraging foreign investment, promoting smuggling activities, and potentially impacting the overall economy by raising inflation and reducing purchasing power.
According to him, “When customs duties are high, the cost of imported goods increases significantly, which is passed on to consumers in the form of higher prices, impacting affordability, particularly for essential items.
“High import duties can make it difficult for businesses to import necessary raw materials and equipment, leading to higher production costs and discouraging foreign investment in the country.
“Nigeria Customs Service, NCS has performed admirably in curbing smuggling but a closer look at the menace according to experts can be traced to to high customs duties that incentivize smuggling. Several honest businesses and individuals try to circumvent customs regulations to avoid paying high taxes, impacting government revenue.
“Amid Nigeria’s optimism to benefit in the regional trade under African Continental Free Trade Area, AfCFTA agreement, the pressure to generate huge revenue at ports and high import duties can make Nigerian businesses less competitive in the global market, as their products may be more expensive compared to imported goods.
“By raising the cost of imports and discouraging trade, high customs duties can negatively affect overall economic growth and development.
“If businesses are unable to operate efficiently due to high import costs, it can lead to job losses in the affected sectors.”
The APFFLON boss who is marking his birthday today in far away United States of America, USA, maintained that in the light of skyrocketing customs duty rates and a staggering 150% increase in asset prices over the past year, the prospect of acquiring new assets appears daunting.
“While potential relief may come from the Senate’s consideration of a bill to stabilize exchange rates for customs duties, the immediate reality remains challenging. Businesses are already grappling with the financial strain worsened by overzealous Customs activities in a bid to meet financial targets.
“As businesses struggle to navigate economic uncertainties more effectively, preserving capital and maintaining operational agility, amidst these turbulent times, the smart choice is for the National Assembly to inspire Customs to tilt towards trade facilitation rather than revenue generation anchored on import duties”, he concluded.
Photo: Otunba Frank Ogunojemite, National President, APFFLON.
Send your press invite, news, press releases/articles to augustinenwadinamuo@yahoo.com. Also, follow us on Twitter @PrimetimeRepor1 and on Facebook on facebook.com/primetimereporters or call the editor on 07030661526.
