FG Plans 0.5% Levy on Imported Goods to Finance AU, ECOWAS Obligations

The Federal Government has stated that it plans to impose an additional 0.5 percent levy on imported goods to meet the country’s obligation to the Africa Union (AU), Economic Community of West African States (ECOWAS), and African Development Bank (AfDb) among others. 

Like other member countries, Nigeria has financial obligations, and apart from those above, other international organisations that the country belong to include the World Bank, Bank for Investment and Development, Islamic Development Bank, United Nations and other multilateral institutions. 

The new levy of 0.5 percent on imported goods was captured in the 2022 finance bill and introduced under Sector 13 for Customs, Excise, Tariff, etc. (Consolidation) Act, Investors King learnt. 

The document partially read, “In addition to extant customs duties and other approved charges, a levy of 0.5 per cent is hereby imposed on all eligible goods imported into Nigeria from outside Africa to finance capital contributions, subscriptions and other financial obligations to the African Union, African Development Bank, African Export-Import Bank, ECOWAS Bank for Investment and Development, Islamic Development Bank, United Nations and other multilateral institutions as may be designated by regulation issued by the minister responsible for finance.”

The document further explained that the amendment was essential to ensure certainty and sustainability of funding of the African Union and other key multilateral development institutions. 

Meanwhile, the Federal Government has also proposed an amendment to the sharing formula for revenue from electronic money transfer (EMT) in the 2022 finance bill. 

Currently, the federal government keeps 15 percent of EMT revenue while 85 per cent goes to the state governments. 

In the proposed amendment which is now with the National Assembly, the federal government is asking to keep its 15 per cent but wants the legislators to split the balance between the state governments and local government councils in a 50 per cent: 35 percent ratio.

This the federal government claimed is in line with the autonomy granted to the local governments across the country.