The Federal Government has been urged to review some of its import policies especially on vehicle importation through the land borders as a way of maximising the revenue generation of the Nigeria Customs Service (NCS) and to curb smuggling.
The immediate past President, Association of Nigerian Licensed Customs Agent (ANLCA) Prince Olayiwola Shittu, who made the call while speaking in a chat with SHIPS & PORTS, weekend, noted the improved revenue collection posted by the various Customs commands in their half year record performance, but stated that the Service would have collected more revenue if the government had re-considered lifting the ban it placed on land border importation of vehicles.
While appealing to the government to rescind its decision on the ban, Shittu said Customs should begin to consider creating a platform on its trade hub portal where importers can obtain advance notice on the amount of duty they are to pay on potential imports.
According to him, “The greatest policy the government should put in place, which is one of the regrets I had during my tenure as President of ANLCA, is the inability of Customs to give importers of vehicles advance access to how much duty they should pay, rather than wait until when your vehicle comes, tender your bill of lading, and do assessment. That way, Customs would have been able to secure revenue for government but I don’t know why they refuse to do it and our import of vehicle is the largest compared to any other country in West Africa.
“Ghana has perfected that and their revenue shot up. It does not matter where your car is coming from. Even then, there will be no need banning the import of vehicles through the border.
“If you are abroad and whenever you want to buy your vehicle, you could just put your Vehicle Identification Number (VIN) on the Customs platform and the platform will calculate how much duty you are to pay, which is what you pay and carry your cargo. So there will be no compromised assessment. If you bring your vehicle through the border and you are able to pay your duty, then you pass through the border. But Customs is reluctant on this whereas Ghana has successfully done theirs.”
Shittu, while calling on government to create the right incentives for importers of vehicles to curb smuggling, noted that despite Customs’ effort to impound smuggled vehicles, most of them still find their way into the country, as some car dealers still smuggle through illegal route while Customs officials are killed daily in the fight against smuggling.
“No government can stop smuggling because some people will always want to beat the system. What the government should do is to look at goods that are very essential to Nigerian citizens and find a way to encourage those who are importing them directly through the port and paying the correct duty, that will be a disincentive to anybody that wants to smuggle.
“Every corner of the country now is filled with used vehicles and many of them pass through the border. All the effort that has been made that you can’t register if you import through the border, people are still finding ways around it. But if we know how much we are supposed to pay, you don’t need to settle anybody, you pay your duty and carry your vehicle. Then there will be no need for smuggling of vehicles that is killing customs officers and creating crises and revenue losses,” he said.
Speaking on the performance of the NCS in the area of revenue generation in the first half of the year, Shittu acknowledged efforts by the Service to block revenue loopholes and increase in exchange rate.
He said, “With the increase in exchange rate, there will also be increase in revenue, because there will be more to pay. Revenue is also a function of import. Nigeria will not cease to import because we are not producing what we are importing. So, as long as Nigeria continues to import, so will Customs revenue continue to go up. But it is a two-way thing; it is either they are very effective or they are blocking all the loopholes. Blocking the loopholes might be a major reason for it while the other alternative might be just squeezing water from the sponge in order to meet the revenue.
“We expect more of that to happen with the benchmark of the foreign exchange that is applied. The present increase in the central bank rate for the purposes of Customs duty calculation will also contribute to increase in revenue for Customs. The practice of issuing waiver to political friends and patronage has been on the decline which also contributed to the revenue increase.”
The various Customs formations had last week posted their revenue performance for the first half of the year with many overshooting their revenue target.
The major Commands, Apapa, Tin Can, Murrtala Muhammed Airport and Ogun raked in a total of N418.3 billion during the period as against N354.5 collected in the corresponding period of last year.