The Minister of Finance, Dr Ngozi Okonjo-Iweala, on Wednesday said the Federal Government was contemplating a downward review of tariff on importation of rice.
Okonjo-Iweala, who disclosed this while answering questions at the ‘Budget 2014 Jam’, in Abuja said the drop in the tariff would reduce smuggling of the commodity into the country.
Budget 2014 Jam is a youth online programme where the minister answers questions on the Federal Government’s 2014 budget from youths across the nation.
The Minister had taken the same position last week when she met with members of the Manufacturers Association of Nigeria in Lagos.
The three-day ‘Budget 2014 Jam’, which began on Tuesday is organised by the Ministry of Finance in collaboration with IBM Technology, a telecommunication firm.
The minister said the existing 110 per cent duty on the importation of rice was encouraging smuggling of the commodity into the country.
“We increased the tariff to 110 per cent, and it encouraged some people to go and grow rice and we grew 1.1 million metric tonnes of the product.
“But it also encouraged smuggling from neighbouring countries because they immediately dropped their own tariffs to 10 per cent,” she said.
She added that the rice issue was similar to tariff on importation of used vehicles, saying “we are watching it now to see what the appropriate tariff to be paid on it will be.’’
The minister added, “For rice, we decided to bring it down because we see that it is not working.’’
Okonjo-Iweala explained that the government had decided to encourage the automobile industry to ensure that vehicles were manufactured in the country.
Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to www.shipsandports.com.ng as the source.