President Bola Tinubu approved the implementation of zero percent import duty and exemption from value-added tax (VAT) on basic food items.
According to a circular obtained by BusinessDay, the policy confirms that, starting July 15, 2024, and continuing until December 31, 2024, the zero percent duty rate and VAT exemption will apply to specific basic food items.
The circular specifies that this policy applies to items such as maize, millet, rice, and wheat, among others. It is designed to help reduce the high cost of food items in the Nigerian market and will be limited to addressing the national supply gap, as determined by a committee established by the Minister of Agriculture.
“The importation of these items will also be restricted to investors who have milling capacity and a verifiable Backward Integration Program for some of the listed items,” the circular stated.
Other items included in the zero-duty policy are husked brown rice, grain sorghum, and beans. Previously, these items had duty rates ranging from 30 percent to 5 percent.
On the same day, the Nigeria Customs Service (NCS) issued guidelines for implementing the zero import duty on food products.
According to a statement signed by Abdullahi Maiwada, National Public Relations Officer, companies wishing to benefit from the zero-duty importation of basic food items must be incorporated in Nigeria and have been operational for at least five years.
Maiwada stated that only companies that have filed annual returns and financial statements, and have paid their taxes and statutory payroll obligations for the past five years, are eligible to participate in the zero-duty importation program.
“Companies importing husked brown rice, grain sorghum, or millet must own a milling plant with a capacity of at least 100 tons per day, have operated it for at least four years, and possess sufficient farmland for cultivation. Those importing maize, wheat, or beans must be agricultural companies with ample farmland or feed mills/agro-processing companies with an out-grower network for cultivation,” Maiwada explained.
He further noted that the basic food items eligible for the zero percent duty rate include husked brown rice, grain sorghum, millet, maize, wheat, and beans. These items previously had import duty rates ranging from 30 percent to 5 percent.
Maiwada added that grain importers must sell 75 percent of their imports through commodities exchanges.
