The recent Executive Order signed by President Bola Tinubu, introducing zero tariffs, excise duties, and VAT on certain pharmaceutical raw materials and specialized machinery, has prompted reactions from various stakeholders, including the Nigeria Customs Service (NCS).
In a chat with our correspondent over the weekend, Abdullahi Maiwada, the National Public Relations Officer of the NCS, stated that the policy would not negatively impact their revenue targets.
He said, “medicaments, with the exception of some categories, are already zero duty. We look at the macro reasons for fiscal policies, which are to encourage manufacturing and make products more affordable. Our bulk revenue comes from large-scale importation, so this policy will not significantly affect our revenue,” he explained.
Maiwada emphasized that the policy’s broader intention is to benefit society by reducing the cost of pharmaceutical production, rather than focusing solely on revenue collection. He assured that the NCS has various revenue streams and that the zero tariffs on pharmaceutical inputs are unlikely to affect overall revenue.
Reacting also, stakeholders in the nation’s maritime industry commended the President for the initiative, while urging him to extend the same to agricultural and other essential products.
Frank Ogunojemite, President of Africa Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON), supported the initiative, highlighting its alignment with previous APFFLON proposals. He suggested that the zero-duty policy should extend to agricultural equipment to address broader economic issues like food inflation.
Ogunojemite stressed the importance of prioritizing citizens’ welfare over Customs revenue targets and called for increased exports to generate more revenue.
On his part, Mr Ojo Akintoye of the Association of Nigerian Licensed Customs Agents (ANLCA praised the timing of the Executive Order, but urged the government to stabilize dollar rates for importers, noting that fluctuating exchange rates are detrimental to businesses.
He criticized the focus on revenue generation at the expense of citizens’ well-being and advocated for extending the zero-tariff policy beyond pharmaceuticals to other essential sectors.
Also speaking, Mr Frank Obikeizie, National Secretary of Association of Registered Freight Forwarders of Nigeria (ARFFN), clarified that the Executive Order targets pharmaceutical inputs rather than finished products, aiming to reduce costs for local manufacturers. He downplayed the impact on Customs revenue, noting that focusing on raw materials for local production shouldn’t significantly affect revenue streams.
The Nigeria Employers’ Consultative Association (NECA) also commended the Executive Order. Director General Adewale-Smatt Oyerinde highlighted that the policy addressed critical cost challenges faced by the pharmaceutical sector, exacerbated by the depreciating Naira.
He stressed the need for diligent implementation and stakeholder engagement to ensure the policy’s success.
