Business - 4 days ago

FG Granted Businesses ₦34 Trillion in Import-Duty Exemptions in 2025 , Customs Says

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The Federal Government approved import duty exemptions covering goods and equipment valued at about ₦34 trillion in 2025, according to the Nigeria Customs Service.

Comptroller-General of Customs Bashir Adewale Adeniyi disclosed the figure during an investigative hearing organised by the Senate Committee on Finance in Abuja.

Adeniyi said the extensive use of Import Duty Exemption Certificates and other government-backed concessions reduced the amount of revenue Customs could collect during the period.

However, the ₦34 trillion figure does not necessarily mean the government lost ₦34 trillion in cash revenue. It represents the estimated value of imports or approvals that received different forms of tax and duty relief. The actual revenue forgone would depend on the duty and tax rates that would ordinarily have applied to each item.

Military Equipment Received Most of the Exemptions

Nearly 60 percent of the approved exemptions were connected to the importation of military hardware.

Adeniyi said the government considered the exemptions necessary because of Nigeria’s security challenges and the need to equip military and security agencies.

Other exemptions covered compressed natural gas equipment, electric and hybrid vehicles, healthcare equipment, medical supplies, industrial machinery, manufacturing inputs and food imported under government intervention programmes.

The waivers show how the government uses fiscal policy to support sectors considered important to national security, industrial development, healthcare and the cost of living.

Removing import duties can reduce the cost of bringing essential equipment and raw materials into the country. It can also encourage businesses to invest in machinery they might otherwise struggle to afford.

The challenge is ensuring that the financial benefit reaches the economy rather than remaining with a small number of importers.

Why Import Duty Waivers Matter

Import duties are taxes collected on goods entering Nigeria. They provide revenue to the government and can also protect local producers from cheaper foreign competition.

When the government grants a waiver, an approved importer may pay a reduced duty or avoid the charge entirely.

Such exemptions can serve legitimate economic purposes. A manufacturer importing production machinery may receive a waiver to reduce the cost of establishing or expanding a factory. A healthcare company may receive relief on medical equipment to improve access to treatment.

The government may also exempt military equipment because national security purchases are funded from public resources.

However, extensive waivers can weaken government revenue when they are poorly targeted, inadequately monitored or granted to companies that fail to deliver the promised benefits.

Adeniyi told lawmakers that the Customs Service could have collected more revenue if not for government-approved waivers and other fiscal policy measures.

Customs Faces Pressure to Meet Its 2026 Revenue Target

The disclosure comes as the Nigeria Customs Service works towards an annual revenue target of about ₦11.07 trillion for 2026.

Customs reportedly collected approximately ₦4.5 trillion by June 30, leaving the agency with roughly ₦7 trillion to generate during the second half of the year.

Meeting the target may become more difficult as the Federal Government introduces additional tariff reductions.

Under Nigeria’s 2026 fiscal policy measures, import duties and levies on selected food products, vehicles, machinery and industrial materials have been reduced.

The government cut the import levy on new vehicles from 20 per cent to 10 per cent and reduced the levy on used vehicles from 15 per cent to 5 per cent. Agricultural and manufacturing machinery received complete duty exemptions, while lower tariffs were introduced for products such as rice and crude palm oil.

These measures are intended to reduce business costs, support production and ease inflation. However, they may also reduce Customs revenue unless increased trade volumes and improved compliance offset the lower rates.

Senate Investigates the Waiver Programme

The Senate investigation is focused on determining how the exemptions were approved, who benefited and whether the waivers achieved their intended objectives.

Lawmakers are examining Import Duty Exemption Certificates issued between March 2020 and December 2025. Reports from the hearing place the total value at approximately ₦34 trillion, although some accounts describe the figure specifically as the value recorded in 2025.

This difference makes greater transparency necessary. The government must clearly distinguish between the total value of exempted imports, the amount of duty waived and the actual revenue the government did not collect.

Without this distinction, the ₦34 trillion figure could be wrongly interpreted as a direct cash loss.

The Senate also threatened sanctions against several government agencies that failed to appear before the committee. The committee said public agencies must account for their participation in the waiver programme and explain whether the incentives produced measurable economic benefits.

Did Consumers Benefit From the Waivers?

The biggest question is whether the exemptions reduced prices for Nigerian consumers.

A duty waiver granted on medical equipment should ideally improve healthcare access or reduce treatment costs. Relief on manufacturing inputs should help companies increase production, protect jobs or offer products at more affordable prices.

Similarly, concessions on food imports should contribute to improved supply and lower market prices.

Adeniyi urged the government to strengthen monitoring and ensure that beneficiaries deliver outcomes such as lower prices, increased industrial production and better access to healthcare.

Where a company receives a major tax concession but does not reduce prices, increase production or create jobs, the government may have surrendered revenue without receiving a meaningful economic return.

This is why waivers should be tied to clear performance conditions.

What the Government Must Do Next

Nigeria does not necessarily need to end import duty exemptions. Strategic waivers can support national security, industrial growth, clean energy, healthcare and food supply.

The government must, however, make the process more transparent.

Authorities should publish the names of beneficiaries, the items imported, the value of each exemption and the economic targets attached to the concession. They should also report whether those targets were achieved.

Companies that fail to meet their obligations should lose the benefit and may be required to repay the waived duties.

Stronger oversight would help Nigeria balance two important objectives: supporting critical sectors and protecting public revenue.

The ₦34 trillion disclosure is therefore not only about how much Customs could have collected. It raises a wider question about whether Nigeria’s tax incentives are producing benefits that justify their cost.

Frequently Asked Questions

Did Nigeria lose ₦34 trillion through import duty waivers?

Not necessarily. The figure represents the reported value of imports or approvals covered by exemptions. The actual revenue forgone would be lower and would depend on the applicable duty and tax rates.

What is an Import Duty Exemption Certificate?

It is a government approval that allows selected imported goods or equipment to enter Nigeria with reduced or completely waived import duties.

Which imports received most of the waivers?

Customs said nearly 60 percent of the exemptions were connected to military hardware. Other beneficiaries included healthcare equipment, industrial machinery, manufacturing inputs, clean-energy vehicles and food intervention programmes.

Why does the government grant import duty exemptions?

The exemptions are used to support national security, healthcare, manufacturing, investment, transportation, food supply and other economic priorities.