In a bid to mitigate the economic impact on businesses, the Central Bank of Nigeria (CBN) has announced a significant reduction in the exchange rate used for computing Customs duties at the nation’s seaports. The move, a 5.3% reduction, comes in response to the recent stabilization observed in the exchange rate of the naira against the dollar.
Effective Monday, March 04, 2024, the Customs FX duty rate has been revised downward from N1630.159/$ to N1,544.081/$, as confirmed by information sourced from the official trade portal of the Nigeria Customs Service. This adjustment translates to a notable decrease of N86.078 per dollar needed for the clearance of goods from the ports, compared to the previous rate in effect as of Friday, March 2, 2024.
Industry analyst Tony Anakebe has underscored the importance of maintaining a stable FX rate for Customs duty evaluation, emphasizing its role in alleviating the burden of high tariffs on businesses. Anakebe pointed out a discernible slowdown at the ports, attributing it to importers’ dissatisfaction with the unfavorable business environment characterized by steep import duties and fluctuating FX rates for duty calculation.
Highlighting recent regulatory actions, it was reported that the apex bank issued a directive last week instructing Customs to utilize the exchange rate prevailing on the date of Form M submission for calculating import duties. Consequently, importers initiating Form M for import trade on Monday, March 4, 2024, stand to benefit from reduced import duty payments, offering them a measure of relief compared to their counterparts who initiated the process earlier.
The CBN’s decision to slash the exchange rate for Customs duties is poised to have significant implications for importers and businesses operating within Nigeria’s import-export sector, offering a glimmer of hope amidst the challenging economic landscape.