IMPORT DUTY WAIVER ROW:

Customs Recants, Says: “We deny making any accusation of corruption in the implementation of the waivers”

In an apparent volte-face over its earlier allegations of large scale abuse of the controversial import duty waiver, the Nigeria Customs Service last week made a retraction of its earlier stand which it had conveyed to the National Assembly.

The Nigeria Customs Service and the supervisory Ministry of Finance have been engaged in a bitter row over the exact amount of import duty waiver that the Federal Government has been granting to some individuals, state governments and corporate institutions.The first salvo was fired by the Customs which alleged last year in response to inquiries from the legislature, that under the waiver regime supervised by the Minister in charge of Finance Ministry; Dr Ngozi  Okonjo-Iweala, more than 65 percent of  incentives on export were for  questionable goods.
The Service had allegedly in a letter to the National Assembly faulted an earlier account of the ministry to the effect that only N171 billion was lost. The Customs told the law makers that: In the last three years, Nigeria lost a staggering N1.4 trillion on import waivers, in addition to losing hundreds of billions of naira more through reckless granting of import/export incentives on unapproved goods from rice to fish to kolanuts, with no significant bearing on the economy.

While comparing the government’s export grant to the well-abused fuel subsidy, the Customs said more than 65 percent of beneficiaries received the grant for goods not approved by the government, which ordinarily should be limited to raw materials, machinery and spare parts.
Recipients of the export grant hold an instrument called Negotiable Duty Credit Certificate, NDCC, which they use in the payment of import and excise duties.

Shipping Position Daily recalls that the waiver and exemption policy was adopted to support the government’s objective to enhance the capacity of the beneficiaries to produce their goods domestically to make the country more self-reliant and reduce dependence on imports.

The categories of exemptions approved by government include the provisions of Schedule 2 of the Customs and Excise Tariff (Consolidation) Act: 1995 – 2001, Common External Tariff: 2008-2012 (as extended); the Customs and Excise Tariff etc. Act No. 16, 1997; and the Finance Miscellaneous Act 39 of 1990.

Sectors of the economy that the law expects should benefit from the policy include agriculture, aviation, health, mines and steel, water resources, gas, power, as well as donations to states, education and related ministries, departments and agencies, MDAs.

But the list of beneficiaries, made available by a source in the Nigeria Customs Service, include private individuals and businesses whose imports appear not valuable to the economy.
For instance, a total of N91.506billion was given as government concessions to 290 beneficiaries between January 1 and December 31, 2011.
But , the Customs, in a statement made available to Shipping  Position Daily in Lagos last week, and signed by its public relations officer; Mr. Wale Adeniyi, even though acknowledged “the document credited to the Nigeria Customs Service was  presented to the National Assembly in November 2013 upon invitation of  the latter to explain shortfalls in projected revenue collection”, denied making any pronouncement or giving any information to the media, after presenting the document to the National Assembly.

In a complete turn-around from its earlier position as presented to the National Assembly, the Customs last week expressed its total understanding of the intentions if the waiver and the export grant.
“We therefore understand the incentives as deliberate policies of Government put in place to stimulate growth in key sectors of the economy like Manufacturing, Agriculture and Power”, it stressed, even as it added that: “…..whatever loss that maybe recorded represents a transfer of 
revenue from one sector of the economy to another”.
Not faulting the revelations in the publications, the Customs added that, “while we appreciate the concerns about the revenue loss raised in  the publications, we agree wholeheartedly with the position of the CME  that the incentives do not represent absolute loss to the economy, 
because the economy ultimately gains more from the incentives granted  through job creation and other benefits”.
It also expressed total loyalty to the fiscal policies of government. “We align ourselves with the industrial policy of Federal Government being implemented by the CME which places preference on sectoral approach to granting of concessions and judicious use of waivers.
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