Why Nigeria Customs revenue fell N216 billion short of 2016 target – Hameed Ali

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The Comptroller-General of the Nigeria Customs Service, NCS, Hameed Ali, on Wednesday said the agency’s revenue for 2016 fell short of its target by N 216.5 billion. Mr. Ali made this disclosure while briefing journalists after appearing before the House of Representatives’ Committee on Customs to defend the Customs 2017 budget estimates.

According to the custom boss, the agency only succeeded in collecting N 720.7 billion, representing 76.8 per cent of the target revenue between January and December last year. The decline, put at 23.1 per cent, was against the original target of N 937.3 billion set for the year by the agency. The agency, Mr. Ali noted, collected N177.9 billion as Value Added Tax on imports , bringing the total revenue collection to N898.6 billion.

Commenting on the drop in revenue, Mr. Ali explained that while there was a proposed policy to collect levies on luxury items consumed by the rich, there was no legal backing to enforce it, adding that luxury goods were imported all through 2016 without the payment of levies. “There was no legal backing to enforce the collection of the proposed levy on luxury items,” he said. “There was no importation of polished rice in the period under review,” he added. Some of the luxury goods covered by the proposed policy, according to the NCS boss, were luxury cars, champagne and furniture.

“Some of our emirs and other traditional rulers love to import Rolls Royce and very expensive cars. You have costly wines and so on for some of the super-rich. The government is saying that if you have decided to buy something out of the ordinary, you should pay a levy,” he explained.

“But, we need a legal framework and policy pronouncement by the Ministry of Finance for the Customs to enforce the levy. We have to be able to determine what to collect on the various categories of items.”

Commenting further, the customs boss explained that out of the budgeted N81.2 billion for its operations in 2016, the agency was only able to access N45 billion.

He, however, lamented that the agency had to fall back on the N6.1 billion savings it had accrued, to pay salaries of its staff.

The Customs not meeting its revenue target brings to two the Nigerian revenue agencies that could not meet their 2016 targets. PREMIUM TIMES reported how the Federal Inland Revenue Service, FIRS, was also unable to meet its revenue target for 2016.