0.5% Tax On African Imports, Danger For Nigerian Economy

The 0.5% tax on all imports from Africa that is being considered for the 2023 Finance Bill will drive up operating costs, production prices, and inflation in Nigeria’s economy.

This was disclosed by Dr Muda Yusuf, Director of the CPPE in a report titled ‘Tweaking the 2023 Finance Bill and Options for Unlocking revenues’ in 2023.

The head of the CPPE applauded the Presidency’s decision to refuse assent to the 2023 Finance Bill, arguing that it is in accordance with democratic ideals of lawmaking and ensures involvement in the legislative process.

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Dr. Yusuf noted that one of the proposals in the Finance Bill is to impose a 0.5% levy that will escalate operating expenses.

“The proposal in the Finance Bill to impose 0.5% levy on all imports coming from outside of Africa will be an additional burden on both businesses and the citizens. It will escalate operating expenses, production costs and fuel inflation in the economy.

“Most equipment, machinery, ICT equipment, and medical equipment are all imported from outside of Africa. Imposing a levy of 0.5% on this group of items will be inimical to investment, economic growth and the welfare of the citizens.

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He added that Nigerian companies are already dealing with profound inflationary effects due to currency depreciation.

“Already, currency depreciation had made imports very expensive with profound inflationary effects. Currently, investors and citizens are paying 0.5% levy on all imports from outside of ECOWAS. This is in addition to import duty and numerous charges and levies paid by importers at the ports.

CPPE noted Many manufacturers import their raw materials from outside of Africa, especially intermediate products not available on the continent. We strongly advise against the imposition of an additional levy on imports.