The federal government on Thursday said it granted import duty waivers and exemptions totalling N170.7 billion to businesses in all sectors of the economy in the last three years.
Minister of Finance and Coordinating Minister for the Economy, Dr Ngozi Okonjo-Iweala, who disclosed this in her response to the 50 questions posed by the House of Representatives Committee on Finance, also disclosed that recurrent expenditure would increase further next year.
Okonjo-Iweala, who condemned the recently observed abuse of the waiver system in connection with purchase of vehicles, however noted that the government cannot do away with waivers and exemptions in view of the country’s objective to produce most of its goods domestically in order to be more self-reliant and reduce its dependence on imports; adding that stronger monitoring of these waivers is being put in place.
“In the past, waivers were granted to individual businesses in an approach that resulted in rent-seeking behaviours and an uneven playing field for other businesses. It was precisely the need to stop such a discretionary approach that led to reforms by the Economic Management Team under the leadership of President Goodluck Ebele Jonathan. A sector-wide waiver policy was introduced to provide specific incentives for some strategic, job-creating sectors. Under this regime, all businesses in a sector have access to the same incentives. Abuse of this system as recently observed is reprehensible; and stronger monitoring of these waivers is being put in place. Over time, the private sector would need to step in to invest in this leasing sector,” she said.
The Minister also defended some of the trade-related policies introduced by the federal government last year especially the increase in the tariff payable on imported rice and the imported vehicles.
“The introduction of these policies will have impacts on tariff revenue collection. Thus a trade-off has to be made between our short-term revenue collection, and our long-term industrial development. We have to weigh the balance between collecting customs revenues today, versus providing incentives to our private sector to stimulate growth and job creation.
“Smuggling remains a scourge, and must be tackled. It is true that some fiscal policies, such as for rice, while leading to greater production has also resulted in smuggling. Efforts are under way with the Minister of Agriculture to correct this.
“Mr. President has instructed the Nigeria Customs Service and the Nigeria Immigration Service to modify their tactics and to work closely with our neighboring countries to combat these leakages” she stated.
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.
