…makes seizures worth N1.9tr
The Comptroller General (CG) of the Nigeria Customs Service (NCS), Adewale Adeniyi, on Thursday, June 6, said the Service has generated N1.34 trillion in the first quarter of 2024.
He added that N318 billion was conceded to exemptions, waivers, and concessions granted to companies in the same period.
Adeniyi also said during the period, 478 seizures amounting to N1.9 trillion were made by its operatives.
He said these when he appeared before the House of Representatives Committee on Finance in the ongoing probe to monitor revenue by Ministries, Departments, and Agencies of the Federal Government.
Adeniyi said with a projected revenue target of N1.269 trillion for the first quarter of 2024, the agency surpassed its revenue target by N77 billion.
He said the agency has a revenue target of 5.079 trillion for the year 2024.
He pointed out that the suspension of excise policy on carbonated drinks, single-use plastics, telecommunication and others in the 2024 fiscal policy measures, adversely affected revenue generation by the agency.
He stressed the need for the Federal Government to ensure Customs officials are actively involved in determining real beneficiaries of the exemption policies.
“What we are asking for is that customs should be actively involved in the decision of who confessions are granted to. This is because we have the profile of this company. We monitor their impacts and export so we are in a better position to advise the government on who should be genuine beneficiaries”, he said.
The Customs boss said China, the United States of America, India and the Netherlands top list of countries Nigerians import goods and products from while Netherlands, Spain, France, and India top the list of countries of export.
He said, “The monthly expected average revenue target stood at N423,255,822,173.79, and as shown below, the collection for January recorded a shortfall of 7.66 percent on the target while February denoted an excess of 6.37 percent and, the month of March equally represented a positive variance of 19.71 percent of its respective monthly estimates. Aggregatory, within the first quarter of 2024, with a total projected revenue of N1,269,767,466,521.38, the sum of N1,347,705,251,658.31 was collected, which recorded a significant improvement of 6.14 percent higher than the periodic target.”
He said the service performed remarkably well in terms of revenue generation within the first quarter of 2024 with 6.14 percent above the periodic target.
He said the Customs’ contribution to the annual revenue target as of March 31, 2024, stood at 26.53 percent.
He added that the trade balance was positive at an advantage of 84.58 percent.
“It is also very important to highlight the activities that cover the Tax Expenditure, which relates to revenue conceded due to Exemptions, Concessions, and grants of any kind, either vide extant provisions as spelled out in Schedule 2 of the Common External Tariff. Cumulatively, the sum of N318,212,274,095.41 was conceded within the first quarter of 2024, and this represented 93.61 percent of the total of N1,347,705,251,658.31 collected during the period under review,” Adeniyi said.
He expressed concern about the smuggling of petrol meant for the Nigerian market to neighbouring countries.
He said activities of cross-border smugglers, who divert petrol to neighbouring countries have made Nigerians not to enjoy the benefits of subsidy removal.
He said: “In terms of fuel, the smuggling of PMS is not allowing us to reap the full benefits of removal of fuel subsidy and we know how critical this is to the government. Our study has shown that there are places in our country where the smuggling of PMS is left unchecked. I am happy to announce that in response to this, we have come up with special operations in the last few weeks targeting the smuggling of PMS. In the next few days, I will be briefing Nigerians on the initial results of these operations which will help us to know the amount we are losing to the smuggling of PMS.”
On the issue of exemptions, Adeniyi said the agency was not responsible for granting custom duties waivers and concessions to companies.
He said sometimes it is the prerogative of the president to determine such beneficiaries.
“Last year, we had to concede over 45 percent of revenue that we generated to exemptions and concessions, there was no doubt about. Even we, as customs, are concerned and we are looking for a balance sheet in the way we manage the exemptions. Let me put it on record that those exceptions are not only normally granted by the Nigerian Customs Service.
“Some of them are granted by Mr. President in excise of power and delegated to the minister of finance where the Import Duty Exemption Certificate is transmitted to the NCS. But the minister has been very upfront in expressing his concerns about the huge numbers that we have in 2023 and he has mince no words in saying that this has to be addressed in 2024. Our observation in the first quarter of 2024 is that waivers had gone to only genuine importers and manufacturers who deserve those kinds of exemptions in our system. They are major players in our economy.
“We should also know that each time we talk about exemptions and waivers, it is very dangerous for us to throw away the baby and the bathing water. Because there could be some advantages that we could get if we give incentives to people who are genuinely involved in manufacturing. Provision of employment, payment of tax and Increase in GDP. All I can say is that there is some level of sanity,” he said.
Adeniyi further revealed that the volume of cargo throughput has reduced compared to the previous year.
He blamed the volatility of the exchange rate for the development.
“The volume of cargo that has been coming to our port in the first quarter has dropped by about 5.14 percent of what we saw in 2023. The cargo throughput has reduced because of the volatility of the exchange rate and the value of the dollar. The reduction in volume of cargo has impacted our revenues”, he said.
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The Deputy Chairman of the Committee, Saidu Abdullahi, said customs would have generated more income for Nigeria’s consolidated revenue fund in the first quarter without the waivers and concessions arrangements.
While commending the agency for surpassing its quarterly revenue target, Abdullahi, urged the service to do more.
“I must encourage you to do more. I can see a man that knows his worth. But you can do well. You said your target is five trillion but you can make it six trillion and the whole country will celebrate you.
“I know you have done well with your revenue but the question is are we guided by cost- the cost-benefit principle when it comes to granting waivers and confessions. This is because we think despite the high turnover rate, imagine having the amount granted to these concessions to what you have generated we will be having around N1.5trn. I think we need to look inward and meticulously address this issue of waivers. If we must grant waivers let there be huge benefits for the country.
“Our problem is revenue generation not borrowing. I want to even see a situation where Nigeria borrows two times of what we are doing but as long as we can generate more revenue that shouldn’t be a problem,” the lawmaker said.
