Nigeria Customs begins application of new exchange rate as Import duty rise – Importers and their agents have said that a 5.0 per cent increase is now effected in duty payable on all imports following the implementation of the new exchange rate by the Nigeria Customs Service, NCS.
The Customs, Vanguard Maritime Report gathered, commenced the enforcement of the new regime following the devaluation of the Naira exchange rate to N381 to a US Dollar, from N361, a development which most importers say will further impact negatively on the economy, especially the inflation rate.
National Public Relations Officer of NCS, Joseph Attah, who spoke with Vanguard Maritime Report on the development explained that the increase is not a function of the Customs but that of exchange regime because as the Customs tariff has not changed.
“However, the exchange regime may result in a higher amount payable. The duty payable when the exchange rate N300 will not be the same when it is N450’’, he stated.
Former National President of the National Association of Government Approved Freight Forwarders, NAGAFF, Eugene Nweke, agreed with the Customs spokesman but stressed that the policy is not in favour of importers who have been excluded from accessing foreign exchange from the official sources.
Nweke noted that the exclusion of the initial 41 items which was later increased to 43, from accessing foreign exchange is in bad test as the same government wants such importers to declare funds they sourced from the black market when they want to import.
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The NAGAFF boss pointed out that when such funds are declared for obtaining ‘‘Form M”, it goes into the system while the same foreign exchange which they are denied is sold to those who sell foreign exchange in the black market.
According to him, “Once the Central Bank of Nigeria, CBN, issues a circular, they direct Customs to implement by changing the exchange rate on their computer.
“However, that is against a subsisting policy which has not been repealed. The CBN, through the minister of finance gives a 90 days period for ‘‘Form M” which is three months; opened from the bank.
“The importer opened the ‘‘Form M” at a particular exchange rate and when the goods arrive in the country within that period, the duty should be in accordance with the exchange rate declared on the ‘‘Form M.”
“But now if you come with your cargo and go to Customs to declare the computed foreign exchange as declared on your ‘‘Form M” which has not expired or when it expires; you go back and verify the ‘‘Form M” but Customs does not respect that as the importer is made to pay based on the current rate.
“The various groups of agents that are supposed to fight this are divided.
“Let me give you one instance, as soon as this government came onboard they declared 41 items that cannot access foreign exchange. You say they cannot access foreign exchange, yet you put in place a policy that says that every cargo coming into Nigerian most come with Form “M”.
“So if somebody cannot come through you to get foreign exchange, you want him to go sell everything in his shop to get foreign exchange from the black market sellers who you have sold foreign currency to and then you want them to go to the banks to declare the money.
“That is using the importers to mop up the funds sold to those in the black market dealers,” he noted.