The Lagos Chamber of Commerce and Industry (LCCI) has called on the federal government and the Nigeria Customs Service (NCS) to suspend the newly introduced 4% free-on-board (FOB) levy, which was announced on Wednesday.
In a statement, Chinyere Almona, LCCI’s Director-General, expressed concern over the sudden introduction of the levy, noting that businesses were not given adequate notice or a chance to prepare for the financial burden it imposes. She highlighted that the abrupt implementation of the charge contradicts international best practices, which stress the importance of transparency and inclusive consultations before the introduction of trade-related policies.
Almona pointed out that, despite the legal backing of the charge under the Nigeria Customs Service Act of 2023, specifically Section 18, the absence of stakeholder consultations before its roll-out was deeply troubling. She emphasized that Section 23 of the same Act mandates public notification and engagement with relevant stakeholders before introducing new charges. However, importers, exporters, freight forwarders, and clearing agents had no prior warning, leaving them unprepared for the added financial strain.
“While we recognize that the 4% charge is legally supported, the manner of its sudden implementation has raised serious concerns within the business community. There was no opportunity to plan or adjust, and this lack of consultation is inconsistent with best practices,” Almona stated.
The LCCI DG warned that the levy could lead to disruptions in trade, with potential delays and congestion at the ports. She further stressed that the additional financial burden could stall shipments, causing a ripple effect that would harm supply chains and economic activities.
Almona also pointed out that Nigerian businesses are already grappling with numerous challenges, including high taxes, levies, rising inflation, interest rates, and foreign exchange scarcity for importing critical goods. Recent issues, such as a potential 50% hike in telecoms tariffs and rising logistics costs due to soaring energy prices, have further strained the business environment.
“The introduction of this charge at such a time, when businesses are already struggling, will only worsen the situation. Instead of boosting government revenue, it risks discouraging business activities and investor confidence, which will ultimately hurt economic growth,” Almona added.
While the NCS surpassed its 2024 revenue target by generating N6.1 trillion, Almona emphasized the need for more investments in port infrastructure and process automation. This, she said, would make the port more efficient, ease the movement of goods, and support export growth, ultimately boosting foreign exchange revenue.
The LCCI also expressed concerns that the levy could lead to a less favorable business environment, which could hinder Nigeria’s ability to capitalize on emerging export opportunities, especially amid global trade uncertainties.
Almona reiterated the chamber’s call for the immediate suspension of the 4% levy and urged the government to focus on improving port efficiency, trade facilitation, and creating a business-friendly environment. She assured that the LCCI is willing to collaborate with the government and other stakeholders to create policies that promote sustainable economic growth for Nigeria.
