The Nigeria Customs Service (NCS) has suspended the implementation of the 4 percent Free-on-Board (FOB) import levy following concerns raised by businesses over the additional financial burden.
The decision, announced on Tuesday in Abuja by Customs National Public Relations Officer, Abdullahi Maiwada, comes amid ongoing consultations with the Minister of Finance and Coordinating Minister of the Economy, Mr. Olawale Edun, and other key stakeholders.
“The Nigeria Customs Service hereby announces the suspension of the implementation of four percent Free-on-Board value on imports as provided in Section 18(1)(a) of the Nigeria Customs Service 2023. This is the sequel to ongoing consultations with the Honourable Minister of Finance and Coordinating Minister of the Economy, Mr Olawale Edun, and other Stakeholders.”
The FOB charge, calculated based on the value of imported goods, including transportation costs to the port of loading, was widely criticised by industry players who argued that it would further escalate the cost of doing business in Nigeria.
The suspension coincides with the expiration of the contract agreement with Service Providers, including Webb Fontaine, previously funded through the one percent Comprehensive Import Supervision Scheme (CISS).
Maiwada noted that this development presents an opportunity to re-evaluate the customs revenue framework and ensure a more sustainable funding structure.
“The timing of this suspension aligns with the exit of the contract agreement with the Service providers, including Webb Fontaine, which were previously funded through the one percent Comprehensive Import Supervision Scheme. This presents an opportunity to review our revenue framework holistically.”
The Nigerian Employers Consultative Association (NECA) had earlier warned that the new charge would impose an estimated N2.84 trillion in additional costs on businesses, worsening economic hardship for importers and manufacturers already grappling with high operating expenses.
Under the previous customs funding structure, the one percent CISS and the seven percent cost of collection were handled separately. The Nigeria Customs Service Act (NCSA) 2023 sought to consolidate these into “not less than four percent of the Free-on-Board value of imports” to ensure sustainable funding for customs operations and modernization initiatives.
Maiwada explained that the temporary suspension will allow for further engagements with stakeholders to align the implementation framework with national economic priorities.
“The suspension period will allow the Service to further engage with stakeholders while ensuring proper alignment with the Act’s provisions for sustainable funding of these modernization initiatives.”
The Customs Service is currently implementing various digital solutions to enhance efficiency in trade facilitation. These include the recently launched B’Odogwu clearance system, designed to streamline cargo processing, reduce delays and improve transparency.
Other modernization initiatives under the NCSA 2023 include the Single Window system, Risk Management System, Non-Intrusive Inspection Equipment and Electronic Data Exchange Facilities.
The agency reassured businesses that it remains committed to enforcing policies that balance revenue generation with trade facilitation.
A revised timeline for the implementation of the FOB import levy is expected to be communicated after the conclusion of stakeholder consultations.
