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REAN Rejects New Import Duty on Solar Panels

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Solar energy - Investors King
  • REAN Rejects New Import Duty on Solar Panels

The Renewable Energy Association of Nigeria, a private sector renewable energy group, has said its members are being forced to pay between five per cent and 10 per cent import duty on solar panels by the Nigeria Customs Service.

REAN said in a statement on Wednesday that under the CET code 8541.4010.00 – a classification for import duty tariff, import duty on solar panels should be zero per cent.

It said, “Consequently, discharge of goods from the ports has been slowed down immensely and demurrage charges have risen for our members since the start of the year.

“This has grave implications for Nigeria’s quest to improve the ease of doing business and deepen energy access for over 70 million people with inadequate access to power.”

The group said the country moved up 24 places from 169th to 145th on the World Bank’s Ease of Doing Business Report in 2017 because the government had demonstrated willingness to improve the business climate and ensure the survival of the private sector. It said, “We commend the Presidential Enabling Business Environment Council team on its successes thus far. However, it will be counterproductive for government agencies at the ports to operate in a manner that sets them against the vision of government. This will reverse achievements this government has made thus far.

“As concerned Nigerians and sector participants, members of REAN have answered the national call by providing solutions to the country’s epileptic power situation and our members currently provide over 10,000 direct and indirect jobs to the Nigerian economy. This is apart from the other benefits such as increased disposable incomes, improved environmental conditions (reduced noise and air pollution due to displacement of diesel generators).”

According to the statement, imposition of arbitrary port charges will accelerate value destruction within this industry and will cause prices to rise to uncompetitive levels.

REAN said, “All over the world, the cost of solar panels is falling, leading to increased adoption of the renewable. Paris-based International Energy Association said that the renewable accounted for almost two-thirds of net new power capacity around the world in 2016, with almost 165 gigawatts coming online boosted by solar. The country stands to lose out on this.

“Nigeria currently does not have capacity to manufacture solar panels but does limited assembly in volumes that cannot meet market demand, hence our recourse to importation while growing capacity locally. This tariff will increase acquisition cost of solar panels in Nigeria, which are currently heavily deplored in rural areas where purchasing power is low.”

The association said this could derail Nigeria’s plan to generate 30 per cent of electricity through the renewable by 2030.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

Economy

Finance Minister Edun Lauds Nigerians for Enduring Economic Reforms Amidst Hardships

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The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has commended Nigerians for enduring the hardships caused by the economic reforms of President Bola Tinubu.

Minister Edun, who spoke on Thursday during an interactive session with the Senate Committee on Finance at the National Assembly in Abuja, highlighted that these reforms have begun to yield positive results.

Edun explained that two critical reforms initiated by the Tinubu government are now at the stage of delivering results.

He added that these reforms will restore the fiscal viability of the country.

“The two critical reforms on the market-based price of Premium Motor Spirit (PMS) and foreign exchange are now at the stage of delivering results, which will, by extension, restore the viability of the nation’s economy through fiscal restoration.”

“These two pillars of the economic reforms, which are now taking positive shape, portend additional revenue for the government, recovery of NNPCL’s finances, and a strong foundation for growing the economy, attracting investment, and creating jobs.”

“I think we need to commend Nigerians for staying the course to this stage of realizing these benefits,” he stated.

The Chairman of the Committee, Senator Sani Musa, said that the session was important as it gave stakeholders the opportunity to deliberate on pressing issues.

He said, “Today, we gather to deliberate on pressing matters related to the sale of crude oil to domestic refineries in Nigeria in naira, its implications on the approved Medium-Term Expenditure Framework and Fiscal Strategy Paper for 2024-2026, and what we should expect for 2025-2027.”

The committee reaffirmed the need for accountability in the NNPC, stating, “Additionally, we will examine shortfalls in NNPCL revenue remittances, focusing on key areas such as foreign and domestic excess crude accounts, the signature bonus accounts, NNPCL cash call accounts, and any outstanding or remitted revenue linked to under-recoveries.”

“This meeting underscores our commitment to transparency, accountability, and responsible management of our national resources.”

Musa concluded that with relevant collaboration, solutions can be identified.

He stated, “I am confident that with the collaboration of the Ministry of Finance under the able leadership of the Coordinating Minister of the Economy, the Office of the Accountant General of the Federation, the Central Bank of Nigeria, the Revenue Mobilization and Fiscal Commission, and other critical stakeholders present here, we will identify solutions and ensure that due processes are upheld for the benefit of our economy and the Nigerian people.”

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Economy

President Tinubu Approves Concrete Redesign for Abuja-Kaduna Road Amid Contract Termination

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The Federal Government has announced plans to address the difficulties faced by road users on the Abuja-Kaduna-Zaria-Kano road with the redesign of the dual carriageway.

This announcement was made by the Minister of Works, David Umahi via a statement on Wednesday.

The Ministry revealed that the 127 kilometers project has been approved by President Bola Tinubu.

This development comes two days after the Ministry of Works announced the termination of its contract with Julius Berger for the Section I (Abuja-Kaduna) of the Abuja-Kaduna-Zaria-Kano Dual Carriageway project in FCT, Kaduna, and Kano States.

Investors King understands that the contract for the rehabilitation of the road was awarded to Messrs Julius Berger (Nig.) Plc on December 20, 2017.

The project, initially valued at N155.7 billion, with a 36-month completion period was further categorized into three sections.

However, only Section II (Kaduna-Zaria) has been completed and partially handed over.

Section III (Zaria-Kano) is partially finished while Section I remains in a severely deteriorated state.

A statement from the Ministry explained that the decision to terminate the contract with Berger was based on non-compliance with reviewed cost, scope, and terms, stoppage of work, and refusal to remobilise to site.

The ministry on Wednesday, November 6, confirmed that Section I has been redesigned and re-scoped.

The statement reads, “The President, His Excellency, Bola Ahmed Tinubu, GCFR has approved that the remaining 127 kilometres of the Rehabilitation of Abuja – Kaduna – Zaria – Kano Dual Carriageway, Section I (Abuja – Kaduna) be redesigned using continuously reinforced concrete pavement (CRCP) instead of the present asphaltic one.”  

“The contract, divided into three (3) sections, was awarded to Messrs Julius Berger (Nig.) PLC on 20th December 2017 at an initial sum of N155, 748,178,425.50 billion (one hundred and fifty-five billion, seven hundred and forty-eight million, one hundred and seventy-eight thousand, four hundred and twenty-five naira, fifty kobo) with a completion period of thirty-six (36) months.” 

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Economy

Tax Expert Warns Tinubu: VAT, PAYE Hikes Will Deepen Hardship for Nigerians

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Due to Nigeria’s economic situation, tax expert Adebisi Oderinde has urged President Bola Ahmed Tinubu to halt plans to increase the VAT and Pay-As-You-Earn (PAYE) tax rates.

Oderinde, who is also the CEO of AOC-Adebisi Oderinde & Co, made the statement during the inauguration of the company’s Head Office in the Kara area of Ogun State.

He said the country’s economic conditions are challenging and particularly unfavorable for SMEs and warned that implementing tax reform could destabilize many small businesses as inflation has already eroded purchasing power in Nigeria.

With over 28 years of experience as a tax consultant, Oderinde noted that new tax reforms would likely worsen hardship across the country.

“My advice is to make hay while the sun shines, as the journey of a thousand miles begins with a single step, and slow and steady wins the race. The country is hard! As a tax practitioner, I continue to pray for our President, but he must heed the advice of elders, especially when it concerns tax reform,” he said.

“This is not the right time to reform any tax, nor to adjust rates. Nigerians’ purchasing power is very low. While some may think of VAT reform as beneficial, it would have a negative impact, especially on Lagos State. One part of the reform aims to cancel the consumption tax, which would hit Lagos hard, as the state earns more from consumption tax than any other state in the federation,” he added.

Oderinde further advised northern Nigeria not to support the proposed policy, warning it could disproportionately affect the region.

“They also want to increase PAYE, and recent data from the NBS in 2023 shows that the total IGR from the 36 states plus the FCT is about N2.4tn, with PAYE accounting for about 63%. If PAYE is raised, it will impact many states significantly. Instead of focusing on VAT, the northern states should consider that an increase in PAYE would affect them even more than VAT,” he explained.

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