Kehinde Fajobi
The Nigeria Customs Service (NCS) has announced the suspension of the 4% Free-on-Board (FOB) charge on imports following consultations with the Minister of Finance, Olawale Edun, and other stakeholders.
Assistant Comptroller of Customs and NCS National Public Relations Officer, Abdullahi Maiwada, disclosed the decision on Tuesday February 11, in a press statement, stating, “The Nigeria Customs Service (NCS) hereby announces the suspension of the implementation of 4% Free-on-Board (FOB) value on imports as provided in Section 18(1)(a) of the Nigeria Customs Service (NCSA) 2023.”
The suspension allows for further engagement with stakeholders regarding the Act’s implementation framework.
According to NCS, the timing of the suspension coincides with the exit from agreements with service providers, including Webb Fontaine, which were funded through the 1% Comprehensive Import Supervision Scheme (CISS). The move provides an opportunity to holistically review the revenue framework.
The previous funding structure, repealed by the NCSA 2023, created inefficiencies in operations, as it separated the 1% CISS and 7% cost of collection, leading to funding gaps in customs modernization.
The new Act addresses these challenges by consolidating at least 4% of the FOB value of imports to ensure sustainable funding for customs operations.
“The Act further empowers the Service to modernise its operations through various technological innovations,” the statement read.
“The Service is already implementing several digital solutions, including the B’Odogwu clearance system, which has improved clearance times and transparency.”
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Other solutions authorised by the Act include Single Window implementation, Risk Management systems, Non-intrusive inspection equipment, and Electronic data exchange facilities.
NCS affirmed that the suspension period will allow for continued engagement with stakeholders and proper alignment with the provisions of the Act.
The Service assured stakeholders that it remains committed to fulfilling its revenue generation and trade facilitation duties.
The revised implementation timeline will be communicated following the conclusion of the consultations.