Nigeria's Delayed Zero Import Tariff Policy on Food Commodities Sparks Frustration

Months after the kickoff announcement, the federal government, led by President Bola Ahmed Tinubu, has delayed implementing a zero import tax waiver on selected food goods.

Husked brown rice, grain, sorghum, millet, maize, wheat, and beans are among the food commodities that were slated to benefit from a zero tariff for a period of 150 days, from July 15 to December 31, 2024.

The tariff waiver was initially announced in June 2024 by Finance Minister Wale Edun as part of President Tinubu's economic policy initiatives aimed at lowering food prices.

Bashir Adewale Adeniyi, the Comptroller General of the Nigeria Customs Service (NCS), confirmed the government's intention to start the tariff waiver in July 2024.

On August 14, 2024, Customs issued a statement declaring that they would soon release comprehensive guidelines for implementing the tariff waiver, marking the beginning of the policy.

“Nigeria Customs Service (NCS) is pleased to announce that His Excellency, the President of the Federal Republic of Nigeria, Bola Ahmed Tinubu GCFR, through the Honourable Minister of Finance and the Coordinating Minister of the Economy, Olawale Edun, has approved the regulation for the implementation of a Zero Percent Duty Rate (0 percent) and Value Added Tax (VAT) exemption on selected basic food items," the statement read.

“This measure aims to mitigate the high cost of food items in the Nigerian market by making essential commodities more affordable for citizens,” Customs stated.

However, Nigerians have expressed disappointment that the policy has not yet been implemented, despite the announcement months ago.

The goal of lowering food costs has not been achieved, and the majority of Nigerians remain frustrated with the rising cost of living.

Food prices remain high despite the National Bureau of Statistics (NBS) inflation reports for July and August, which indicated a slight decrease in food inflation to 39.53 and 37.52 percent, respectively.

According to a market survey conducted by DAILY POST on Monday, the price for a 50-kilogram bag of domestic or imported rice ranges from N87,000 to N106,000, while the price for a 50-kilogram bag of beans ranges from N65,000 to N100,000. For many Nigerians, access to staple foods has become a struggle, a situation that could have been alleviated by implementing the zero-tariff waiver on specified food items.

In an interview on Monday, Muda Yusuf, Executive Director of the Centre for the Promotion of Private Enterprise, discussed the situation. He identified the government's sluggish implementation of the zero tariff policy as the main issue.

Yusuf explained that a significant delay exists between the government's announcement of the policy and the creation of implementation guidelines.

He emphasized that the economy had not yet felt the full effects of the tariff waiver because it had not been fully implemented.

Yusuf urged the administration to accelerate the program’s implementation. “The customs must implement the policy. The customs need to be advised by the ministry of finance, and until that is done, implementation cannot start."

He further explained: “I think it has to do with the speed of the implementation of the policy. When the Government announces a policy, the ministry ought to work on the guidelines, which are transmitted by the ministry of finance to the customs. I think there is a lag between the announcement of the policy and the production of the guidelines."

Yusuf added that “the policy has not been fully activated, which is why the impact is not felt. This is because all the processes in terms of guidelines are a bit slow. The government needs to work on the speed of implementation."

He also raised concerns over potential internal challenges, stating: “Generally speaking, from the circular available, there are no clear-cut directives apart from the fact that some of the tariffs were mentioned. There are no proper guidelines for its implementation. The Customs must put it into proper perspective.”

“There is the possibility of internal sabotage or frustration in getting the implementation right. Customs may be having internal challenges about the proper classification or coding of the tariff waiver into its portal,” Yusuf concluded.