The Nigeria Customs Service (NCS) has announced the suspension of the 4% Free-on-Board (FOB) charge on imports, as outlined in Section 18(1)(a) of the Nigeria Customs Service Act (NCSA) 2023.
This decision comes as consultations continue with the Minister of Finance and Coordinating Minister of the Economy, Olawale Edun, along with other key stakeholders.
By suspending the charge, the NCS aims to allow further discussions with stakeholders and refine the implementation framework of the new Act.
The timing of this decision coincides with the completion of contract agreements with service providers such as Webb Fontaine, which were previously funded through the 1% Comprehensive Import Supervision Scheme (CISS).
The transition presents an opportunity to reassess the Service’s revenue framework comprehensively.
Under the previous funding structure, the separation of the 1% CISS and the 7% cost of collection led to operational inefficiencies and funding gaps for customs modernisation initiatives.
The new Act seeks to address these challenges by consolidating “not less than 4% of the Free-on-Board value of imports,” ensuring a more sustainable financial model for essential customs operations and modernisation efforts.
During the suspension period, the NCS said it would focus on optimising financial management to align with both stakeholder interests and national economic objectives.
The NCSA 2023 grants the Service authority to advance its modernisation agenda through technological innovations. Section 28 of the Act specifically enables the development and maintenance of electronic systems for seamless information exchange between the NCS, other government agencies, and traders.
NCS spokesman, Abdullahi Maiwada, in a statement on Tuesday, said several digital solutions have already been deployed, including the recently introduced B’Odogwu clearance system, which has significantly improved clearance times and enhanced transparency.
Other modernisation efforts backed by the Act, according to him, include trade process streamlining through the implementation of the National Single Window, enhanced security and efficiency via Risk Management Systems, faster cargo clearance with non-intrusive inspection equipment, and improved inter-agency collaboration through electronic data exchange facilities.
Maiwada said the NCS remains committed to implementing the NCSA 2023 in a way that balances revenue generation with trade facilitation while addressing the concerns of stakeholders.
He added that the revised timeline for implementing the 4% FOB charge will be announced once stakeholder consultations are concluded.
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