Just In: Customs Approves 43% Increase in Import Duty

Confidence UbaniFebruary 2, 20241 Mins read588

The Central Bank of Nigeria (CBN) has given the nod to a significant 43% hike in import duty rates, making it the fourth increase within a span of less than 14 months.

The CBN, responsible for determining exchange rates for duty collection, shocked importers and trading stakeholders when they woke up to discover the new exchange rate. Previously set at N951.842 per $1 as of December 2024, it has now surged to N1356.42 on Friday.

The Chief Executive Officer of the Center for the Promotion of Private Enterprises (CPPE), Dr. Muda Yusuf, expressed dismay, stating that this increase will exacerbate the already challenging economic situation. He questioned whether the Governor of the CBN had considered the implications of these actions.

“I am shocked at the development, I mean with all these suffering, with all these costs, we have not recovered from the unification of the exchange rate they just did, now another increase in duty.

“This increase will definitely affect every area of our economic life, already; we recorded a drop in the volume of imports last year, so you imagine what will happen with this increment.”

The broader impact of the increase includes a significant rise in import costs that would affect transportation, shipment, and clearing. This, he warned, would inevitably slow down activities in the maritime sector, which has already seen a reduction in tempo.

Highlighting the potential devastation, Yusuf cautioned against an upward review of the exchange rate for import duty computation.

Former Executive Secretary of the Nigerian Shippers Council, Mr. Hassan Bello, echoed a similar concern.

“As the Naira further depreciates against the Dollar, we will have less importation”, he said. The upward increment of the Nigerian exchange rate is set to affect every sphere of the economy.

While India slashes import duty on mobile components to 10%, Nigeria veers in the opposite direction with an unprecedented hike in import duty. In the backdrop of the nation’s depreciating currency, this hike is a distasteful recipe for disaster.