Wisdom Engraced
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The newly approved Nigeria Customs Service (NCS) four per cent free on board (FOB) valuation charge has raised concerns among importers, clearing agents, and the business community. Stakeholders warn that the charge could lead to a significant increase in the cost of clearing imported goods, including vehicles.
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Auto dealers have expressed worry that the additional charge would drive vehicle prices beyond the reach of average Nigerians and suffocate demand for affordable used cars. “They were making as much as N15 million to N20 million profit on a single vehicle. If they now hike it by another N1 million to N2 million because of the new charge, who will buy it?” one dealer asked.
The cost of clearing imported vehicles and general cargo could spike by as much as 40 per cent, according to concerned stakeholders. Freight forwarders who have already processed vehicle importation jobs under the new regime reported duty spikes of up to 40 per cent. “The increment is high. Almost 40 per cent has been added to the old duty we’ve been paying,” said Clinton Okoro, Chief Executive Officer of Globjoy Investment Limited
The Comptroller-General of Customs (CGC), Bashir Adeniyi, explained that the implementation of the FOB levy was essential to fund the technology platform critical to modernising customs operations. “There was some misunderstanding among stakeholders, but the Act clearly states that all administrative and operational costs will now be covered by the new FOB levy,” Adeniyi said.
The Secretary of the Customs Consultative Committee (CCC), Eugene Nweke, noted that the four per cent FOB levy is a cost component that adds to the cost of clearance from customs and can be considered a burden to the shipper. “While the NCS may argue that it replaces existing fees and aims to modernise customs operations, the reality is that it still increases the financial burden on importers,” Nweke said.
The new charge has also raised concerns about the potential impact on the competitiveness of Nigerian businesses and the overall economy. As the prices of vehicles and other imported goods continue to rise, many Nigerians may find it increasingly difficult to afford them.
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Jonathan Nwokpor
