The Comptroller-General of the Nigeria Customs Service (NCS), Col Hameed Ali, has called on the Federal Government to reintroduce import tax on petroleum products. The Comptroller-General said this before the House of Representatives Committee on Customs.
Prior to the suspension of import tax on petroleum products in 2004, a tax of N1.50 was paid by fuel importers on a litre of any petroleum product.
Why the tax should be brought back? Ali said Nigeria needed to reintroduce the tax regime to align with global best practices. According to Punch, Ali said that the tax was being practised in about 36 countries at the rate of about $2.24 per gallon.
What this means: Going by a recent report by the United Nations (UN), 98 million Nigerians are now living in multidimensional poverty. Normally, in this regard, the government’s focus should be on putting in economic policies to drive and boost local trade and income, instead of putting more tax burden on already poor citizens.
Speaking further on taxes in general, Ali said that a proposal had been drafted and sent to the Finance Minister on the consideration for a downward review of vehicle tariff. The customs proposed that the import duty on imported vehicles should remain 35% while the levy should be reduced from the current 35% to between 5 and 10%.
Ali made known that if the downward review of these taxes were approved, it would help to reduce the rate at which vehicles are smuggled into the country. He said that it would encourage compliance and boost revenue as the 70% import duty and levy currently is encouraging smuggling of vehicles.
Recall that the automobile dealers had earlier complained of the import duties on vehicles as they accused the Customs of allowing corruption to thrive and at the same time causing distress to buyers of new vehicles in the country with their duties and system of documentation.