*Employers’ association says it’s NCS’ desperate attempt to meet N10tn target
*Argues levy will impose additional N2.84tn in costs
*MAN kicks against port authority’s increase in fees
Saraki knocks customs, urges FG to halt implementation of new policy
Emmanuel Addeh in Abuja and Dike Onwuamaeze in Lagos
There was a groundswell of opposition to the introduction of a fresh 4 per cent administrative charge on Free-on-Board (FOB) value of imports by the Nigeria Customs Service (NCS) as well as the proposed 15 per cent increase in port charges by the Nigerian Ports Authority (NPA) at the weekend.
The Nigeria Employers’ Consultative Association (NECA), Manufacturers Association of Nigeria (MAN) and a former Senate President, Bukola Saraki, in separate reactions to the new policies, agreed that they were ill-timed and therefore called for a halt to their implementation.
NECA described the introduction of the 4 per cent levy by the NCS as a desperate attempt by to meet its N10 trillion revenue target contained in the 2025 proposed national budget, stressing that the new charges would squeeze N2.84 trillion from private businesses and increase duty paid by industries by 80 per cent.
MAN, on its part, urged the NPA to shelve the proposed 15 per cent increase in port charges because it’s ill-advised and signalled a departure from the federal government’s commitment to improving the country’s ease of doing business.
Also, Saraki criticised the NCS, observing that the fee will further impoverish Nigerians who will bear the brunt of the new policy to extract additional monies from importers.
Director General of NECA, Mr. Adewale-Smatt Oyerinde, said in a public statement that the new charges contradicted the ongoing tax reform efforts led by the Presidential Fiscal Policy and Tax Reforms Committee, chaired by Mr. Taiwo Oyedele, aimed at harmonising taxes and supporting business sustainability.
Oyerinde said: “With a revenue target of N10 trillion 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.”
He further noted that at a time when businesses are calling for a streamlined tax system, the levy undermines reform efforts and sends a negative signal to investors.
He added that with Nigeria’s annual imports estimated at N71 trillion, the newly introduced levy will impose an additional N2.84 trillion 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.
“The Nigerian business environment is already burdened with multiple taxes, unpredictable policies, and economic challenges. With rising unsold inventories and growing unemployment, policies should support businesses and not further strangulate them.
“This additional levy on import-dependent businesses will escalate production costs, fuel inflation, and threaten jobs. Ultimately, consumers will suffer from higher prices, worsening an already challenging economic climate,” Oyerinde argued.
The NECA chief also criticised the NCS for prioritising revenue generation over its core mandate of trade facilitation and economic development. According to him, this approach is counterproductive and directly contradicts the government’s ‘Ease of Doing Business’ agenda.
NECA, therefore, called for an immediate reversal of the levy and urged the government to engage with stakeholders to develop a more sustainable and business-friendly approach to revenue generation.
“Government must take urgent steps to ease the financial burden on businesses and citizens, rather than implementing policies that will worsen economic hardship and stifle business growth,” NECA said.
In his reaction to the NPA’s proposed increase of port charges by 15 per cent, the Director General of MAN, Mr. Segun Ajayi-Kadir, in a statement said that the association has grave concern over the increase because it is coming at a time when businesses are struggling with the rising cost of operations, high rate of foreign exchange, astronomical energy costs, and general economic uncertainties.
Ajayi-Kadir pointed out that imposing any additional financial burden on manufacturers through increased port tariffs would exacerbate the challenges being faced by operators in the real sector.
He said: “Nigeria’s current economic climate is characterised by rising inflation, foreign exchange challenges, and declining industrial capacity utilisation.
“Many businesses are experiencing a worrying downturn due to unsustainable operating costs. Increasing port tariffs is therefore ill-timed and could signal a departure from the government’s avowed efforts and commitment to the ease of doing business.
“It is inevitable that this additional strain on industrial activities will ultimately lead to reduced capacity utilisation and possibly job losses. Furthermore, Nigeria must remain competitive in regional trade. Neighbouring countries with more efficient and cost-effective ports will become far more attractive alternatives, leading to increased cargo diversion.”
According to him, this will not only reduce revenue for the Nigerian government but will encourage smuggling and other untoward trade practices that weaken our economy.
He further argued that port-related charges constitute significant indirect costs to manufacturers as most of their raw materials and industrial machinery are imported through the ports.
“Any increase in charges will have a ripple effect, leading to higher production costs, increased inflationary pressures, and reduced competitiveness of locally manufactured goods.
“Many manufacturers who operate as tenants in NPA facilities will also face escalated costs, which could significantly disrupt the slight moderation in the mounting challenges that has bedeviled the manufacturing sector in recent times,” he said.
The manufacturers’ association suggested that reducing turnaround time for vessels and improving cargo clearing processes could significantly boost revenue instead of increasing port charges.
It also advised the government to address bureaucratic bottlenecks that delay cargo clearance in order to ensure faster throughput and more efficient revenue collection, adding that improving port infrastructure will enhance operational efficiency and attract more business, leading to natural revenue growth.
It argued that aligning Nigerian port charges with global best practices would encourage more trade volume and increase overall earnings instead of raising tariffs.
The MAN, therefore, implored the NPA to shelve the proposed 15 per cent tariff increase and instead collaborate with stakeholders to explore sustainable alternatives for revenue generation.
It said that increasing tariffs in the current economic climate would have dire consequences, including increased cost of production, leading to higher prices of goods and fanning inflation.
Besides, the organisation stressed that it will reduce competitiveness of Nigerian manufacturers in local and international markets and increase smuggling due to high costs at Nigerian ports compared to neighboring countries.
MAN also argued that this would bring about a decline in government’s revenue due to lower cargo turn out and manufacturing downturn.
“Rather than imposing additional financial burdens on businesses, we propose a stakeholder dialogue to explore strategies for enhancing port efficiency, reducing operational bottlenecks, and creating a more business-friendly environment that will ultimately lead to increased revenue without undermining industrial growth and competitiveness.
“We earnestly advocate for caution and deep reflection on the part of the NPA, as a key stakeholder in Nigeria’s economic development. NPA’s consultation with key economic actors after it has decided on the increase is tantamount to putting the cart before the horse and does not demonstrate goodwill. We call on NPA to rescind the planned increase in order to avert a monumental downturn in the fortunes of businesses in Nigeria.
“The manufacturing sector can ill-afford such an increase at this time; it runs against the present administration’s efforts at making Nigeria a trading hub in the West African sub-region, and would definitely constitute a drag in the efforts of government to stabilise the economy in the year 2025,” the group said.
In the same vein, former Senate President, Saraki, at the weekend criticised the NCS for introducing the 4 per cent charge on the FOB value of imports, observing that the fee will further impoverish Nigerians who will bear the brunt of the policy.
Last week, the NCS in a statement, said the directive to implement the 4 per cent charge was in line with the provisions of the Nigeria Customs Service Act (NCSA) 2023.
The service explained that the FOB charge, which is calculated based on the value of imported goods, including the cost of goods and transportation expenses incurred up to the port of loading, is essential for driving the effective operation of the service.
It urged all stakeholders to comply with the directive, which it said was conceived after extensive consultation with relevant stakeholders and organisations, noting that “All stakeholders are urged to support this legally binding initiative.”
But Saraki, who took to his verified X handle to express his opposition to the move, maintained that the huge administrative funding for customs in a country with the current poverty index was unacceptable.
Aligning with both MAN and NECA, he argued that importers will inevitably pass the costs on to consumers, further straining the budgets of millions of already struggling households.
“With our annual imports estimated at N71 trillion, the new 4 per cent customs administration charge on FOB value will come to N2.84 trillion. Does this mean that the Customs Service requires an additional N2.84 trillion annually to do its job?
“Don’t forget they already have a budget and get an incentive percentage on total customs duties collected. Now, they want to spend more than $1.5 billion on running costs in a country with the poverty index we have and with many businesses closing down.
“Importers will inevitably pass these costs on to consumers, further straining the budgets of millions of struggling households,” the former governor of Kwara state pointed out,” he said.
To Saraki, the new fee cuts across and is not restricted to luxury goods alone, a development he said will not augur well for the country and its people.
“This new fee of 4 per cent is not even restricted to luxury goods but across all imports, so even for industries that import their raw materials whose duties are only 5 per cent, the customs agency will now charge importers an extra 80 per cent of the duty amount as administrative fees!
“How can this make sense or support the government’s policy of promoting the ease of doing business? The government must urgently reconsider this policy and put it on hold immediately. Especially not now with what Nigerians are going through,” he maintained.
Immediately after the announcement last week, the NPA had also announced a 15 per cent increase in its tariffs. The move, it said, aimed to address aging infrastructure, obsolete equipment, and slow port capacity expansion.
“Compelled by the exigency of bringing Nigerian Ports up to speed with those of its peers in terms of infrastructure and equipment, the NPA has secured necessary approvals for an upward review in its tariffs which was last reviewed in the year 1993.
“The 15 per cent upward increase (sic) which is to cut across all NPA rates and dues is premised on the urgent need to address the undesirable reality of aged and weak infrastructure, obsolete equipment and slow port capacity expansion which has continued to diminish the performance and indeed competitiveness of Nigerian ports,” it argued.
