The Federal Government is proposing the imposition of new taxes on petroleum products, non-alcoholic beverages and telecommunications service providers as it moves to increase its revenue-generating capacity to fund the 2021 Appropriation Act.
They want the return of a N1.50 levy on each litre of petroleum product brought into the country and the taxing of non-alcoholic beverages like alcoholic drinks and tobacco.
This disclosure was made by the Controller General of the Nigerian Customs Service (NCS), Col. Hameed Ali (Rtd.), while appearing before the House of Representatives Committee on Customs to defend its 2020 Budgetary performance and 2021 proposal.
According to a report from Punch, Ali, who led top officials of the Customs before the committee, made written and oral submissions with the lawmakers also grilling him for about 3 hours.
READ: LNG boss tasks FG to begin the monetization of Nigeria’s gas
What the Controller-General of the Nigerian Customs Service is saying
The Customs boss told the lawmakers that as part of strategies to improve revenue generation in 2021 based on the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper, the service introduced the e-Customs, which will make its operations electronic and automated.
He said, “Proportionally, it is the service’s expectation that, as a result of this reform, we will increase the revenue base of the government.’’
The Customs boss also said that the service recommended and the government approved downward tariff review of the current 35% levy on new and luxury imported vehicles to 5%, in addition to the downward review of commercial vehicles from 35% to 10%.
READ: CBN Governor says Dangote refinery will sell refined products to FG in Naira
He said, “This is to encourage massive importation of vehicles into Nigeria and further increase the revenue base of the government; also, and most importantly, to reduce smuggling of vehicles through our borders. The complaint has always been that the tariff is too high and, therefore, people are forced to go through the borders to smuggle their vehicles.
“Based on that and now that we have succeeded in reducing these duties, it is our belief that most of the vehicles coming into Nigeria will come through the ports and by so doing, it will create jobs, increase earnings for not only the Customs but also other operatives in the marine sector. So, it is a win-win situation as far as we are concerned.”
READ: Dangote tells FG to allow only refinery license holders to import petrol
Ali stated that a levy would now be reintroduced on petroleum products, in addition to the recommendation to the introduction of taxes on telecommunications service providers on the recharge cards they produce, while carbonated drinks would also become taxable soon.
He said, “One of the reasons for us to tax carbonated drinks is that, if we tax alcoholic beverages and tobacco because they are injurious to our health, carbonated drinks, with the content of sugar, are equally injurious to our health.
“Most of the diabetes cases we see today are as a result of consumption of these drinks. So, it is deadly; as deadly as tobacco. Alcohol is less deadly than them. But we are still running a zero excise duty on these companies.”
READ: Customs revenue rises by N200 billion to hit N1.5 trillion in 2020
Why this means
- The proposal of the Nigerian Customs Service of the introduction of new taxes is coming at a time the Federal Government had declared tax reliefs for businesses and individuals due to the devastating impact of the coronavirus pandemic.
- However, the government is looking for ways to improve its revenue-generating capacity to be able to fund the 2021 Budget.
- This will ultimately increase the burden for Nigerians as these businesses are expected to pass the cost of their services and products on to them.
Please tax water, air,sun, moon and stars.
Cost of living is already very tough for an average Nigerian. These taxes would only make it worse. It would have helped if the taxes would go into quality roads, quality and affordable healthcare, better and competitively priced utilities. Because these are some of the main cause of pains to people.
Well written. However, all you have mentioned are contained in the budget which is funded via tax receipts, oil revenue and borrowing. Amid dwindling oil revenue and accelerating debt-GDP ratio, what do you think should be done by the fiscal regime to fund the budget? Use water and air to subsidize the real sector?
When oil is not enough is it tax that will be enough? It’s obvious that you people want to kill the masses of this country, even if you add 200percent on every thing it will not be enough until the people say no to you people.
This government is confused, it is found of making life difficult for the poor, this old man that know nothing about taxation is the one telling us that revenue will increase if those items are taxed, why can’t the government taxed the rich more and grant reprieve to the poor, it is the poor masses that are going to suffer these tax increment more… Nonse
Nigeria Govt should go and tax any Nigerian with more than 5 vehicles at home or any one that has more than one house they should be paying taxes to the govt every month on those surplus properties…
Which one is non alcoholic beverages like alcoholic drinks, and my problem remains that the ones collected has not been put to effective use si why asking us fir more