The N39 billion revenue deficit recorded by the Nigeria Customs Service (NCS) in the last one year, has been linked to the Central Bank of Nigeria (CBN)’s monetary policy, recession and smuggling, BAYO AKOMOLAFE reports
A few days ago, the Nigeria Customs Service (NCS) said that a total of N898 billion was collected as revenue for Federal Government at seaports and borders as revenue for 2016.
The amount is N39 billion below the expected target, while it is N6 billion less than the revenue generated in 2015. The service generated N904 billion in 2015 and had targeted N937 billion for 2016. It was learnt that the service lost N10.27 billion on vehicles to smugglers in the period.
Challenges
Other factors that have been contributing to the low revenue is the implementation of the national auto policy and CBN’s policy on foreign exchange, which barred importers of 41 selected items from accessing the official foreign exchange window.
Within the last 12 months, CBN’s policy forced some Nigerian importers out of shipping, as they found it difficult to source foreign exchange for their imports. This led to smuggling and cargo diversion to neighbouring ports.
Already, NCS had complained that low container traffic had grossly affected its revenue generation. It noted that the volume of import had fallen at the seaports and borders.
Spokesman of the service, Mr. Joseph Attah, also attributed the shortage to underdeclaration and concealment, among other sharp practices by importers. He recalled that the service was given a target of N937 billion as revenue in 2016.
Attah noted that the total amount collected was inclusive of VAT of N898 billion. “If VAT is removed, duty collection is N720 billion, our performance represents a of 76.90 per cent,” he explained.
Breakdown
Between January and November 2016, the service generated N815. 7 billion.The revenue was N89.3 billion less than the amount realised in the same period in 2015.
A breakdown of the revenue revealed that in January 2016, the service generated N74.380 billion; February, 62.886 bllion; March, 61.228 billion; April, N57.381 billion; May, N57.055 billion; June, N72.772 billion and July, N75.603 billion; August, N95.766 billion while in September, N90.211 billion, October, N83.889 billion and November, N84.514 billion.
However, the revenue dropped in October by N6.322 billion from the N90.211 billion collected in September 2016. Also in December, N83 billion was generated.
Reaction
The National President, National Council of Managing Directors of Licensed Customs Agents (NCMDLCA), Mr. Lucky Amiwero, decried the current hike in import duty on vehicles in 2014/2015 from 10 per cent to 35 per cent with an additional surcharge of 35 per cent.
He said the policy had brought the total tariff to 70 per cent, adding that this had negatively impacted on government revenue and port operations.
Leakages
During the period, the Comptroller General, NCS, Col. Hameed Ibrahim Alli (rtd), explained that over 90 per cent of vehicles verried to neighbouring countries were on transit to Nigeria market.
Despite the duty rates chargeable for motor vehicles at both land borders and seaports, which remain the same, he noted that importers of vehicles had been exploiting the informality of land border trade to short change the nation.
Statistics revealed that vehicles properly imported through the land borders from January 2014 to December 31, 2016, were 209,691, valued at N38.55 billion, while smuggled vehicles seized within the same period were 5,998 with duty paid value of N10.27 billion.
Conclusion
There is need for government to introduce policies that will make Nigerian ports the hub of maritime activities in West and Central Africa.
– New-Telegraph
