The federal government on Wednesday approved the regulation for the implementation of a Zero per cent Duty Rate and Value Added Tax (VAT) exemption on selected basic food items.
Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, confirmed the development to THISDAY on Wednesday evening.
The Nigeria Customs Service (NCS) also disclosed the development in a statement, adding that President Bola Tinubu okayed the implementation through the finance minister.
National Public Relations Officer, Chief Superintendent of Customs Abdullahi Maiwada, further explained that the new policy will take effect from August 15, 2024 (Thursday) till December 31, 2024.
The measure aims to mitigate the high cost of food items in the Nigerian market by making essential commodities more affordable for citizens.
Maiwada also stressed that the initiative was part of the government’s broader effort to address food security challenges and ensure that basic foodstuffs were accessible to all Nigerians.
He emphasised that while the temporary measure was intended to address current hardships, it did not undermine the long-term strategies put in place to safeguard local farmers and protect manufacturers.
The customs spokesman added that the implementation of the policy will focus on addressing the national supply gap.
He explained that to participate in the zero-duty importation of basic food items, a company must be incorporated in Nigeria and must have been operational for at least five years, and must have filed annual returns and financial statements and paid taxes and statutory payroll obligations for the past five years.
Maiwada said companies importing husked brown rice, grain sorghum, or millet needed 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.
Similarly, 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.
The basic food items eligible for the zero per cent duty rate include husked brown rice, grain sorghum, millet, maize, wheat and beans.
The statement further noted that 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 the policy.
The policy requires that at least 75 per cent 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, Maiwada added.
He said the penalty also applied if the company exported the imported items in their original or processed form outside the country.
He maintained that the NCS under the leadership of Comptroller General of Customs, Bashir Adewale Adeniyi, remained committed to supporting government policies to enhance food security and promote economic stability.
The service, therefore, urged all stakeholders to cooperate fully in implementing the initiative for the benefit of all Nigerians.
