The Nigeria Employers’ Consultative Association (NECA) at the weekend cautioned the Federal Government about the potential negative impact of the newly introduced 4% Free On-Board valuation on imports levy by the Nigeria Customs Service (NCS) on ordinary Nigerians.
The umbrella employers’ association in a statement issued by its Director-General of NECA, Adewale Oyerinde, indicated that with Nigeria’s yearly imports currently valued at N71 trillion, the latest levy would further raise import duty payments by 80%, thereby raising production costs of businesses and worsening the surging inflation rate.
The Director-General clarified: “With Nigeria’s annual imports estimated at N71tn, the newly introduced levy will impose an additional N2.84tn in costs. For industries that rely on imported raw materials, this charge will drive duty payments up by 80 per cent, significantly inflating production cost and eroding competitiveness.
“The ripple effects will be severe—higher inflation, deeper poverty, and a weakened investment climate”, he added.
According to him, the Nigerian business environment is already burdened with multiple taxes, unpredictable policies, and economic challenges.
Oyerinde maintained that with rising unsold inventories and growing unemployment, policies should support businesses and not strangulate them.
This is even as he pointed out that the latest levy did not align with the government’s ongoing tax reforms by the Presidential Fiscal Policy and Tax Reforms Committee, which aims to harmonise taxes,
The NECA boss rued: “At a time when businesses are calling for a streamlined tax system, this levy undermines reform efforts and sends a negative signal to investors.
“This approach is counterproductive and directly contradicts the Government’s Ease of Doing Business agenda. With a revenue target of N10tn set for the NCS in the 2025 Budget by the National Assembly, this levy appears to be a desperate attempt to meet revenue projections at the expense of businesses and ordinary Nigerians.
“While the Government may achieve its revenue goals, the unintended consequences will be severe—higher costs of goods, business closures, rising unemployment, and worsening economic hardship for millions of citizens.
“Government must take urgent steps to ease the financial burden on businesses and citizens, rather than implementing policies that will worsen economic hardship”, Oyerinde added.
He stated that the NECA was calling for an immediate reversal of the levy and urging the Federal Government to engage stakeholders for the purposes of developing a more sustainable approach to revenue generation.
