Business News

Customs seek of excise duties for carbonated drinks

*blames revenue leakages to lack of Scanner/Smuggling 

By Ignatius Okorocha

 The Nigeria Customs Service (NCS) has advocated  introduction of excise duties for companies involved in the production of carbonated drinks in the country to improve revenue generation of the nation.

This was as he blamed the underperformance of the service to inadequate use of scanners at the nation’s Sea Ports and challenges from border communities.

Controller-General of NCS,  Col. Hameed  Ali (Rtd) made the call at a public hearing on the 2022-2024 Medium Term Expenditure Framework (MTEF)and Fiscal Strategy Paper (FSP) in Abuja on Wednesday.

The public hearing was organised by the Senate Joint Committees on Finance, National Planning , Foreign and Local Debts,Banking , Insurance and Other Financial Institutions and Petroluem Resources with revenue generation and management agencies of government  in attendance.

 Ali, who was responding to  a question on why the NCS was yet to meet its target on revenue generation said the revenue generation of the NCS was predicated on market forces that drives import  to Nigeria.

He advised that payment of excise  for revenue generation should not be based on  imports alone but also on domestic production of goods.

He said the only excise NCS  was authorised to collect was excise from Tobacco and alcoholic beverages.

He said there was need to also look in the direction of collecting excise from  carbonated drinks,to improve the revenue profile of the nation.

He  also attributed challenges in revenue generation of the NCS to issues of smuggling at the various boarders, saying that smuggling had become a way of life for some people.

He,however, said the NCS had put in place structures to curtail issues of smuggling.

Alli said the NCS was  employing improved manpower and leveraging on technology via its Electronic Customs structures.

He announced that the NCS  was on the verge of deploying three scanners at the various ports in the country, for proper and speedy examination of  containers into the country.

This,he said  would ensure 100 per cent and speedy  examination of containers and reduce  incidence of under payment of duties and false declaration of goods.

He also disclosed that  NCS was also due to  deploy 135 scanners around the various land borders to further enhance effectiveness of its operations.

Ali, said  the non provision of infrastructure for border  communities was also aiding smuggling at the boarders, nothing that smuggling was a way of life to some of the citizens.

“The  border communities do not want to cooperate in fighting smuggling because of absence of government in their communities, some times they cooperate with the smugglers because of the support they receive from the smugglers.”

He,however, said the NCS had been involved in some  cooperate social  responsibility for the border communities to discourage smuggling, noting that it was not enough to deter smuggling activities.

He also urged the National Assembly to elvolve further measures to mitigate smuggling activities in the nation’s borders.

Ali, however, revealed  that NCS generated in 2020 generated  N1.5trillion, while N1.02trillion has  been generated   so far in last six months of 2021.

 Director General ,Debt Management Office (DMO), Ms Patience Oniha,  in her presentation said there was an increasingly  higher level of new borrowing provided in the 2022-2024 MTEF.

She said the renewed higher level of borrowing has a direct impact on debt  service, saying that there was an urgent need for significant  boost in revenue to avoid unsustainability of public debt.

She said a re-prioritisation of projects to limit borrowing to such projects only was one way to reduce the level of new borrowing.

Oniha also  recommended  that a  Public Private  Partnership(PPP) arrangements  be given a sharper focus to reduce the direct borrowings by the Federal Government.

Ealier, Chairman of the Joint  Committee, Sen. Solomon Adeola (APC Lagos) said the public hearing was designed to get the true situation of  revenue of the country as presented in the 2022- 20224 MTEF and FSP document  before presentation of  budget extimates by President Muhammadu Buhari to the National Assembly.
He said there was the need to plug all revenue leakages and improve revenue for social services and infrastructure development.

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