Renewed Hope : CGC Adeniyi walks the talk, unveils guidelines for implementation of zero duty rate on basic food items

Renewed Hope :  CGC Adeniyi walks the talk, unveils guidelines for implementation of zero duty rate on basic food items

In line with the Presidential Order and renewed hope initiative of President Bola Ahmed Tinubu to tackle high cost of living, the Nigeria Customs Service has unveiled the guidelines for implementation of zero duty rate on basic food items in the country.

The Comptroller General of Customs, CGC Bashir Adewale Adeniyi MFR, in walking the talk, made the announcement, saying that the Presidential directives aimed at alleviating the hardship faced by Nigerians due to high prices of essential food items.

His assertions : “The Nigeria Customs Service (NCS) 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 implementation of Zero Percent Duty Rate (0%) and Value Added Tax (VAT) exemption on selected food items.

“This policy is effective from July 15, 2024, and will remain in force until December 31, 2024.”

According to the CGC :  “This measure aims to mitigate the high cost of food items in the Nigerian market by making essential commodities more affordable for citizens. The initiative is part of government’s broader efforts to address food security challenges, to ensure that basic food tuffs are accessible to all Nigerians.

“However, it is important to state that while this temporary measure is intended to address current hardships, it does not undermine the long-term strategies put in place to safeguard local Farmers and protect Manufacturers.”

He explained : “It is pertinent to note that implementation of this policy will focus on addressing the national supply gap. To participate in 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, paid taxes and statutory payroll obligations for the past five years.

“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 pointed out : “The basic food items eligible for zero percent duty rate are as follows: S/N Item Description ECOWAS CET H.S. Code Previous Duty Rate + Levy New Duty Rate
I. Husked Brown Rice 1006.20.00.00 30% 0%
II. Grain Sorghum – Other 1007.90.00.00 5% 0%
III. Millet – Other 1008.29.00.00 5% 0%
IV. Maize – Other 1005.90.00.00 5% 0%
V. Wheat – Other 1001.19.00.00 20% 0%
VI. Beans 0713.31.90.00 20% 0%”

The CGC went on : “The Federal Ministry of Finance will periodically provide Customs with a list of importers and their approved quotas to facilitate the importation of these basic food items within the framework of this policy.

“The policy requires that at least 75% of imported items be sold through recognised commodities exchange, with all transactions and storage recorded. Companies must keep comprehensive records of all related activities, which the government can request for compliance verification.”

He informed : “If a company fails to meet its obligations under the import authorisation, 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.”

CGC Adeniyi assured :  “The Nigeria Customs Service, under the current leadership  remains committed to supporting government policies, to enhance food security and promote economic stability.  We urge all stakeholders to cooperate fully in implementing this initiative for the benefit of all Nigerians”.

Recall that recently, the Federal Government through Nigeria Customs Service declared its intention
to remove import duties and taxes on essential food items. Thus, this implementation strategy is in fulfilment of that promise.