The Nigeria Customs Service (NCS) has released comprehensive guidelines for the implementation of a Zero Percent Duty Rate (0%) and Value Added Tax (VAT) exemption on selected basic food items, as approved by President Bola Tinubu.
This policy, which is effective from July 15, 2024, until December 31, 2024, aims to alleviate the economic hardships faced by Nigerians due to rising food prices.
“Drawing from the Presidential directives aimed at alleviating the hardship faced by Nigerians due to high prices of essential food items, the Nigeria Customs Service is pleased to announce that His Excellency, the President of the Federal Republic of Nigeria, Bola Ahmed Tinubu, GCFR, through the Honourable Minister of Finance and the Coordinating Minister of the Economy, Olawale Edun, has approved the regulation for the implementation of a Zero Percent Duty Rate (0%) and Value Added Tax (VAT) exemption on selected basic food items,” stated Abdullahi Maiwada, a Chief Superintendent of Customs and National Public Relations Officer.
In a statement released on Wednesday, Maiwada explained that the initiative is designed to make essential commodities more affordable.
“This measure aims to mitigate the high cost of food items in the Nigerian market by making essential commodities more affordable for citizens,” Maiwada said.
“The initiative is part of the government’s broader efforts to address food security challenges and ensure that basic foodstuffs are accessible to all Nigerians,” he added
“To participate in the zero-duty importation of basic food items, a company must be incorporated in Nigeria and have been operational for at least five years. It must have filed annual returns and financial statements and paid taxes and statutory payroll obligations for the past five years,” explained Maiwada.
“Companies importing husked brown rice, grain sorghum, or millet need to own a milling plant with a capacity of at least 100 tons per day, operated for at least four years, and have enough farmland for cultivation.
“Those importing maize, wheat, or beans must be agricultural companies with sufficient farmland or feed mills/agro-processing companies with an out-grower network for cultivation,” he noted.
The eligible food items for the zero per cent duty rate include husked brown rice, grain sorghum, millet, maize, wheat, and beans.
The Federal Ministry of Finance will periodically provide the NCS with a list of importers and their approved quotas to facilitate the importation of these basic food items.
“The policy requires that at least 75% of imported items be sold through recognised commodities exchanges, with all transactions and storage recorded. Companies must keep comprehensive records of all related activities, which the government can request for compliance verification,” Maiwada stated.
“If a company fails to meet its obligations under the import authorization, it will lose all waivers and must pay the applicable VAT, levies, and import duties. This penalty also applies if the company exports the imported items in their original or processed form outside Nigeria,” he warned.
The NCS, under the leadership of Comptroller General of Customs, Bashir Adewale Adeniyi, MFR, remains committed to supporting government policies aimed at enhancing food security and promoting economic stability. “The Service urges all stakeholders to cooperate fully in implementing this initiative for the benefit of all Nigerians,” concluded Maiwada.
