The Centre for the Promotion of Private Enterprise (CPPE) has warned that Nigeria could lose cargo to nearby countries because of high exchange rates for import duties collected by the Nigerian Customs Service (NCS).
This was shared in a statement by Dr. Muda Yusuf, the Director and CEO of CPPE. He shared concerns about how the high exchange rates for import duties are hurting businesses and making living costs higher in Nigeria.
The statement said that if cargo ships choose to go to other countries, it could hurt the government’s ability to make money.
The statement reads, “The high and changing exchange rate for import duties is making inflation worse. It increases costs for businesses, making everything more expensive. It also puts jobs in the maritime sector at risk and discourages investors. There’s also a risk that cargo might be sent to other countries or smuggled in, which would hurt customs revenue.”
This problem is serious because, in the first half of the year, the Nigeria Customs Service saw fewer cargo ships coming in even though their revenue went up by 127% during that time.
Call on President Tinubu to set customs exchange rate at N1000/$
CPPE is asking President Tinubu to set the customs duty exchange rate at N1000/$ for the next six months by signing an Executive Order. This move would help businesses and people facing hard times.
Even the Presidential Committee on Fiscal Policy and Tax Reforms suggested this, and many business groups agree.
Right now, the customs duty exchange rate on the Nigeria Customs Service website is N1578/$, and it keeps changing almost every week. This is causing problems for investors.
The Ministry of Finance, not CBN, should set import duty rates
- The centre raised two main points: one about foreign exchange policy and the other about trade policy. They believe the Central Bank of Nigeria (CBN) should only handle the opening of Form M for importers under the current foreign exchange rules.
- CPPE says that international trade matters should be handled by the Federal Ministry of Finance and the Federal Ministry of Trade and Investment, as these are the legal bodies for trade policy.
- They criticized CBN for setting the customs duty exchange rate, calling it an overreach and saying it needs to be corrected immediately.