No benefits from waivers, says Fed Govt

From Nduka Chiejina, (Assistant Editor), Abuja

The Federal Government has said it had not seen the benefit of granting waivers, after years of granting them to importers and losing trillions of Naira in the process.

It was learnt that the Federal Ministry of Finance, Budget and National Planning yearly receives over 600,000 different requests on import duty waivers from government agencies, private sector, non-governmental organization (NGOs) through its fiscal policy measure of granting waivers.

The Permanent Secretary in the ministry, Dr. Mohammed K. Dikwa, spoke at an intensive stakeholders’ forum for the Automation of Import Duty Exemption Certificate (IDEC) and Vehicle Number Identification (VREG) processes in Abuja.

Dikwa, who was represented by Mrs Fatima Hayatu, a Director in the Department of Technical Services of the ministry, regretted that “despite these huge figures, it is still not clear what benefits have accrued to government in return in terms of jobs created, additional tax revenues paid by beneficiaries and other impact to the economy”.

He said: “The process of applying for and processing of waivers, determining eligibility of applicants, validating previously granted waivers, reporting utilisation of waivers are currently all manual. This results in lack of transparency and lengthy bureaucratic process that could take upwards of usually between 60 to 180 days, thereby exposing the process to subjectivity and abuse.”

To address the loss, the permanent secretary said the the Federal Government planned to launch the Automation of Import Duty Exemption Certificate (IDEC) and Vehicle Number Identification (VREG) processes in the first quarter of 2020. Import Duty Exemption Certificate is a tool used by the Federal Government to achieve some of its fiscal policies of increasing economic activities and employment generation in some target sectors.

The ministry has engaged FourCore Technology Solutions Limited to develop and manage a solution that makes the processes – from application to processing, granting, validating, renewing and checking levels of utilisation – much easier and faster by utilising and integrating a set of technology tools and applications.

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The technology solutions company was charged “with providing the infrastructure to automate the entire process end-to-end, including a dashboard that provides empirical data to measure the impact of this Fiscal Policy lever to the economy”.

Besides investing in the technology to achieve this goal, the ministry said it had also invested in the digitalisation of all past IDEC records and procured the necessary technology for the responsible principal officers, including an IDEC Processing Centre at the ministry.

The second component of the project, the Vehicle Identification Number Registration (VREG), will provide a national repository of all VINs in the country, including the ones coming in through the national ports of entry.
Vehicle importation accounts for about 30% of the total import duties alone representing a significant portion of our total import.

Dikwa explained that a national VIN system will provide “a centralised registry that draws historical data from a global VIN repository to keep track of vehicles coming in and out of the country”.

The VIN registration process, he said, also serves as “a check for all smuggled vehicles into the country as it provides a unified database for all vehicles independent of their points of entry and provides a basis for Nigeria Customs Service (NCS) to effectively collect duties on smuggled vehicles”.

The VREG component will also provide the nation with a vehicular asset registry, which can be leveraged for movable asset valuation, insurance, taxation and correct assessments.