The Nigeria Customs Service (NCS) announced on Wednesday that President Bola Tinubu has approved a Zero Percent Duty Rate (0%) and Value Added Tax (VAT) exemption for selected basic food items.
Customs spokesman Abdullahi Maiwada stated that the approval was conveyed by the Minister of Finance and Coordinating Minister of the Economy, Olawale Edun.
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Effective from July 15, 2024, and lasting until December 31, 2024, this policy aims to alleviate the financial burden on Nigerians caused by the rising costs of essential food items.
“However, it is important to emphasise 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,” the Customs spokesman noted.
He added that the policy’s implementation will focus on addressing the national supply gap.
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“To participate in the 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 and 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 said.
FULL LIST
He listed basic food items eligible for the zero percent duty rate as follows:
I. Husked Brown Rice
II. Grain Sorghum
III. Millet
IV. Maize
V. Wheat
VI. Beans
“The Federal Ministry of Finance will periodically provide the NCS 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 exchanges, with all transactions and storage recorded. Companies must keep comprehensive records of all related activities, which the government can request for compliance verification.
“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,” the Customs spokesman added.
