<3h> Nigeria customs</h>

By Umar Ardo, Ph.D


With the abysmal fall in oil prices, high rise in oil bunkering and consequent decline of government revenue, compounded by the near nosedive of most economic activities occasioned by high profile corruption and financial leakages in the public service, I commend the president for his foresight in taking on the hard decisions to tackle the economic issues of the country. The removal of the oil subsidy, unifying the exchange rates and the signing of the electricity bill reforming the power sector, and especially the five broad fundamental principles guiding the Tinubu administration, will all go a long way in both revamping and remodeling our economy and bringing about growth and development of our country.

It is important to note, sir, your inauguration as 16th president of Nigeria coincides with a new global order of declining Western influence, the rise of new power blocs of China, Russia, India, Brazil and their intrusion into Africa, thereby occasioning severe economic challenges and power dynamics across the globe. All these are emitting novel interactions and effects, creating winners and losers amongst nation-states of the world. Nigeria must thus respond strategically if she hopes to come out of it as a winner. Consequently, I must say, Mr. President, that these your laudable policies call for serious inwards looking more than ever before in the rebuilding of the economy and stabilizing the polity. This inwards-looking means looking towards the Nigeria Custom Service (NCS) to generate the needed alternative revenue. This open letter aims to outline the method of achieving this objective for the federal government of Nigeria.


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Your Excellency, without denigrating the efforts of the current leadership of the NCS in its service delivery, I must say a whole lot is left to be desired in maximizing the revenue generation potentials of the NCS.

For example:

i. While it may seem as if Revenue Generation through Customs has improved, in reality it has not if the FOREX rate is taken into account;
ii. Revenue leakages have been widened as a result of poor service capacity of men and officers of the NCS; and
iii. In spite of the border closure, smuggling activities have worsened, further bleeding the Nigerian economy.


i. Revenue Generation – Revenue generation has fallen by about 50% compared with 2014 figures contrary to stated mandate. In 2014, the Customs collected =N=997.00 Billion Naira with an exchange rate of =N=197.00 to $1.00 USD to total $5 Billion dollars. In 2018 the Service generated only a paltry $2.5 Billion dollars =N=1.01 trillion Naira with an exchange rate of =N=306.00 to $1.00 USD. 2019 totals are even more deplorable. And it has gone even lower in 2022;
ii. Smuggling Activities – With border closures and importation only through the seaports, smuggling activities have now practically become more technical and in quantum leaps;
iii. Revenue Leakages – From estimation of experts, over N30 trillion Naira literally stands legally recoverable if blocked, which revenue can finance 75% of Nigeria’s annual budget, aside from oil income;
iv. Under-performance – Currently, because of low service capacity, the Customs Service is grossly underperforming. The Presidential Committee on the Trade Malpractices and the Senate Committee on Customs based their investigations and findings on the following two principal factors:
i. Non Payment of Import Duties, Levies and Taxes;
ii. Diversion and Non-Implementation of Government Fiscal Policies; and
v. Hardly anyone in breach of Customs laws is being prosecuted any longer and indeed, cases taken to court are lost with heavy penalties against the Service and Government.

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i. Given that the NCS is the protector and promoter of our national economy, there is urgent need for an institutional reform Service as a condition precedent to achieving maximum service delivery. It will greatly enhance security, through control of importation of arms and ammunition as well as serve as a check on money laundering and the financing of terrorism; and
ii. Urgently set up a Presidential Panel for the purpose of recovering the over =N=30 Trillion in leakages;

The Panel should:-
i. Identify all Companies/Individuals who abandoned their Import Documents (RAR/PAAR) in their Banks and recover the appropriate duties and taxes due to Government;
ii. Identify all Companies/Individuals who benefitted from Duty Exemption/Concessions but failed to use them for the purpose for which they were given and sanction them in accordance with the provisions of section 43 of CEMA – that is fine of 6 times the value of the goods imported;
iii. Identify all Companies/Individuals who benefitted in one way or the other from the Fiscal policies of Hospitality Industry, Tabaco/Cigarettes Industry, Rice Revolution and Auto Industry but failed to comply with the terms of the policy and recover the duty difference;
iv. Identify all Companies that fraudulently benefitted from the Concessions for the Utilization of Nigeria’s Natural Gas, but knowing full well that they are not using Nigeria’s Gas for their operations and recover the Duty and Taxes involved;
v. Identify all Containers/Cargoes fraudulently removed from the Sea Port/Air Ports without payment of Duties and Taxes and recover same;
vi. Retrieve manifests from shipping companies on export of crude oil and gas and investigate same for compliance in accordance with S.55 and S.58 CEMA;
vii. Detect fraud and make recoveries from Export Expansion Grants (EEG);
viii. Liaise with Export Inspection Companies and CBN to investigate the quantities and volume of all exports including oil and gas with a view to ensuring the remittance or transfer of export proceeds to Nigeria within the stipulated period;
ix. Liaise with the shipping companies to verify the re-exportation of empty containers within 90 days as stipulated in WTO convention;
x. Recover duties and taxes on Empty Containers not re-exported in accordance with Rule 5B of the HS nomenclature;
xi. Verify all temporary imported consignments with a view to ensuring re-exportation or duties and taxes collected for non exportation;
xii. Government to re-introduce collection of Royalties on exportation of Solid Minerals such as Gold, Diamond and other precious Stones. These Minerals are today being mined and smuggled out from states like Zamfara, Kebbi, Sokoto, Plateau, etc.; and
xiii. Excise Factories: Presently only the under listed Factories are under Excise:
(a). Alcoholic beverages;
(b). Tobacco and cigarettes;
(c). Perfumes and perfumery products.

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In addition to the above, Government should consider the expansion of the excise Factories and/or raw material import policies and appoint a career Customs officer that is competent, patriotic and disciplined as the Comptroller General of Customs (CGC) with a clear mandate to carry out the reform as outlined above.


It is clear from the reports of the Presidential Committee on Trade Malpractices and the Senate Committee on Customs that Nigeria is not able to collect its trade taxes compared to our counterparts. This is as a result of poor or total lack of training of officers and men giving way to absence of professionalism, ignorance, mediocrity and corruption in addition to ineffectiveness of the NCS Board failing from its duty to interpret the Customs laws, Customs Codes and Customs and Excise Notices exposing the nation to flagrant abuse and revenue leakages.


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