Skip to main content

Increase in customs duty threatens three million jobs

Loss of about three million jobs is real as government’s implementation of the 43 per cent increase in customs duty in the country takes its toll.
Agents and freight forwarders who are now closing shop due to poor patronage, say the increase in duty has begun to hit hard on importers, who also have to cope with the burden of the new exchange rate of N313 to $1, up from N197 to a dollar last year.
The Nigeria Customs Services (NCS) increased duty twice in a month, in line with the new Central Bank of Nigeria (CBN) flexible foreign exchange (forex) rate policy. The first time was from July 1, when the customs directed that the dollar rate used for calculating import duty be increased from N197 to N286 to a dollar. Again, effective August 1, the calculations increased to N313 to a dollar.


Indeed, it is estimated that about three million jobs in the industry are now being threatened, just as many operators are considering re-locating to neighbouring countries with friendlier policies.
The Guardian learnt that the operators are currently groaning under intense hardship and are considering dialogue with the CBN and the Ministry of Finance. The National Association of Government Approved Freight Forwarders (NAGAFF) lamented the stifling of its members’ businesses due to what it described as the “seeming irrational” exchange rate of N313 to $1 being used for imports assessment in Nigeria.
Similarly, agents under the aegis of the Association of Nigerian Licensed Customs Agents (ANLCA) are groaning under the new exchange rate pressure.
President of ANLCA, Olayiwola Shittu, told The Guardian that the policy was capable of truncating the gains made in the maritime sector if not reversed, warning that members might be forced to withdraw their services.
Against the widely reported plans to shut the ports, Shittu said his group was not planning any such action, but the members might withdraw their services when businesses are no longer forthcoming.
According to him, it’s unfair to compel Nigerians to open form ‘M’ for imports at N197 to $1 “and now force them to pay N313 after the goods have been shipped.
“Government should allow those who raised ‘form M’ at N197 and travelled to calculate their duty at N197 when the cargo arrives. It should not be that somebody opened ‘form M’ at N197 and travelled, and when the cargo arrived, you asked him to pay N313. From where will he get the money?”
National Publicity Secretary, Stanley Ezenga, said the aggrieved stakeholders would make appropriate representation to the government through the CBN and urge the benchmarking of the exchange rate.
“We indeed advise the Minister of Finance, in consultation with the CBN governor, to benchmark the exchange rate for customs duty purposes. It is legal and legitimate in favour of trade and the society in Nigeria.”
The President, Shippers Association, Lagos State, Jonathan Nicol, said the situation was already posing a threat to the jobs of over three million workers in the sector.
Nichol noted that with the new forex regime, shippers are paying more duty while the costs of goods are skyrocketing.


Meanwhile, the NCS has absolved itself of blame for the duty hike saga, noting that the CBN is the agency prescribing the rate for foreign exchange which is used to charge duty. The Comptroller-General of Nigeria Customs Services, Col. Hameed Ibrahim Ali, assured that the agency would continue to monitor inflow and outflow of goods and promote the balance of trade agenda of the government.
Ali, who was in Lagos at the weekend to inspect some seized containers at the Apapa Ports Command, said Nigerians should endeavour to increase local production in order to reduce dependence on importation.
Join our BBM channel for instant updates : C0030863D

Comments

Post a Comment

Popular posts from this blog

Collapsed banks in Ghana recovered only $142 million out of $2 billion loans, Bank of Ghana Governor reveals.

The Governor of the Bank of Ghana, Dr Ernest Addison says out of the $2 billion (GHS10.1 billion) worth of loans taken by the receivers of some nine banks which collapsed in the country, only $142 million (GHS731 million) has been received. The Governor of the Bank of Ghana (BoG), Dr Ernest Addison The nine banks were UT Bank, Capital Bank, Sovereign, Unibank, Construction Bank, The Royal Bank, Heritage Bank, Premium Bank and Beige Bank. According to him, the receivership process has been painstakingly slow with other loan defaulters and shareholders of the defunct banks engaging in frivolous legal cases to sabotage the process. “The process has progressed slowly as out of the total loans of $2 billion (GH¢10.1 billion) taken over by the Receivers, total recoveries so far is in excess of $142 million (GH₵ 731 million) and this has been achieved through loan repayments by customers; repayment of placements; sale of vehicles; liquidation of bonds; and from...
Post a Comment
Read more

How OPEC Agreed A 1.2Mbpd Production Cut

After months of wheeling and dealing, the member nations of the Organization of Petroleum Exporting Countries (OPEC) have finally agreed an average drop in production level of 1.2 million barrels per day, effective January. The agreement exempted Nigeria and Libya, but gave Iraq its first quotas since the 1990s, Bloomberg reports. Iran seems to be the greatest winner, as OPEC agreed for the country to raise output to about 3.8 million barrels a day as the country sought special treatment as it recovers from sanctions. However, Iraq OPEC’s second-largest producer, agreed to cut by 210,000 barrels a day from October levels despite its previous push for special consideration based on the urgency of its offensive against Islamic State. Saudi Arabia, which raised oil production to a record this year, will reduce output by 486,000 barrels a day to 10.058 million a day. The United Arab Emirates and Kuwait will reduce output by 139,000 barrels a day and 131,000 a day while ...
Post a Comment
Read more

BOOM: Nigeria’s External Reserves Drops To Lowest In 11 Years

Nigeria’s foreign exchange reserve fell to $25,780,765,483 (25.78 billion) as of August 16, the lowest we have seen since 2005. The drop was down 2.11% from a month ago. The Nations external reserves dropped below $26 billion for the first time on the 5th of August 2016 after it closed at about $25,971,610,949. In fact, the external reserves has dropped by about $480 million dollars in August alone compared to just $100 million in the whole of July. Ironically, the current balance of $25.9 billion is worth about 80% more than what it was in Naira following the depreciation of the naira after it was floated. The CBN has in the past few days ramped up sales of dollars at the interbank in the hope that it will create liquidity in a market that is yawning gape to swallow forex after nearly almost two years of intense rationing by the CBN. The Naira weakened to its lowest ever at the interbank after it closed at about N362.5/$1 in midday trading. The Naira will eventua...
Post a Comment
Read more