Import Duty Waiver Scheme Stopped in Nigeria

The import duty waiver scheme which was used to encourage importers of raw materials has been abolished by the Federal Government of Nigeria. The scheme has been abused by importers and in 2011, about N37.2 billion is said to have been lost from import duty waivers that were granted to importers. It is estimated that Nigeria lost N276.9 billion between 2000 and 2008.

The import duty waivers were granted to about about 1,843 beneficiaries during former President Olusegun Obasanjo's administration. There are currently about 183 individuals and businesses using import duty waivers, and other exemptions and concessions. Some of the beneficiaries include companies belonging to g government officials and businesses such as, The Redeemed Christian Church of God, Messrs Western Metal Products, International Hotels, Mandarin Hotels, Le Meridian, Grand Ikoyi Towers & Resort, Federal Palace Hotels, Dangote Industries, Vaswani, and Stallion Group.

A report that examined the import duty waiver program in Nigeria said Dangote got "a concession of five per cent for raw sugar and exemption from payment of 10 per cent of sugar levy. The exemption is ongoing and has no expiration date. Dangote also has a two year concession from payment of duties on the importation of tomato paste."

There have also been repeated allegations that the Federal Government has been granting illegal and indiscriminate import duty waivers to undeserving firms and individuals.

Speaking during a Senate session, a Deputy Comptroller General of the Nigeria Customs Service (NCS), Alhaji Garuba Makarfi said that the Presidency has directed that import duty waivers should not be granted for 2012. He also spoke about the Federal Government Export Expansion Grant program which has also been subject to abuse, saying "We lost 7 per cent of our collection to export expansion grant which is non-negotiable, this amounted to about N37.2 billion. The grant was given to export-oriented companies and local manufacturers, to export raw materials, but instead, these local manufacturers sell their certificates to dealers who then use it to import cars into the country."