Nigeria Customs release guidelines for implementation of zero duty rate on staple food items

As a follow up to the Presidential directives to alleviate the hardship faced by Nigerians due to high food prices of staple food items, the Nigeria Customs Service (NCS) has released guidelines for the implementation of a zero percent duty rate and Value Added Tax (VAT) exemption on selected basic food items.

According to Customs National Public Relations Officer, Abdullahi Maiwada, the policy takes effect from July 15, 2024, and will remain in force until December 31, 2024. This measure aims to make essential commodities more affordable for citizens and address food security challenges.

Maiwada said to participate in the zero-duty importation, companies must meet specific criteria, including being incorporated in Nigeria, operational for at least five years, and meeting tax obligations. Additional requirements apply for companies importing specific food items, such as owning milling plants or farmland.

He said the Federal Ministry of Finance will provide the service with a list of approved importers and quotas to facilitate the importation of these basic food items. Companies must sell at least 75% of imported items through recognized commodities exchanges, keep comprehensive records, and comply with government regulations to avoid penalties.

He said the NCS, under the leadership of its Comptroller General, Bashir Adewale Adeniyi, remains committed to supporting government policies to enhance food security and promote economic stability.

The Service sought the full cooperation of all stakeholders in implementing the initiative.

Nigeria’s reliance on food imports has reached alarming levels, with the country spending a staggering N920.54 billion on imported food items in the first quarter of 2024 alone, according to the Nigeria Customs Service (NCS).

This represents a 95.28% increase from the same period in 2023, highlighting the nation’s struggles with food security and self-sufficiency.

The Comptroller-General of Customs, Wale Adeniyi, who disclosed this in Abuja on Tuesday, revealed that the country’s food import bill has continued to rise, despite efforts to boost domestic food production.

Adeniyi emphasised the need for concerted efforts to achieve food security and stabilise domestic prices.

The massive food import bill has prompted the government to implement measures aimed at reducing the country’s reliance on imported food items. These initiatives include the removal of tariffs and import duties on key staples such as rice, wheat, maize, and sorghum, as well as plans to cultivate over 10 million hectares of land and collaborate with state governors to accelerate food production.

However, the NCS has warned that the tariff suspensions will result in significant revenue forfeiture, estimated at N188.37 billion over the next six months.

To mitigate this, the NCS said it is introducing measures to expedite the clearance of food items, prevent smuggling, and leverage technology to ensure effective implementation of these initiatives.