The Federal Government approved Import Duty Exemption Certificates covering goods and equipment valued at approximately ₦34 trillion in 2025, according to the Nigeria Customs Service.
The figure has triggered concerns about Nigeria’s revenue position, but it should be interpreted carefully. It represents the value of imports covered by approved exemptions, not necessarily ₦34 trillion in taxes that the government would otherwise have collected.
Comptroller-General of Customs Bashir Adeniyi disclosed the figure during a Senate Committee on Finance hearing. He said about 60 per cent of the approvals were connected to military equipment imported in response to Nigeria’s security challenges.
Other beneficiaries included importers of compressed natural gas equipment, electric and hybrid vehicles, medical supplies, industrial machinery, manufacturing inputs and goods covered by food-intervention programmes.
What is an import duty waiver?
An import duty waiver allows an approved company, institution or government agency to bring specified goods into Nigeria without paying all or part of the normal customs duties.
Governments use waivers to support activities considered economically or socially important.
For example, removing duty from medical equipment can reduce the cost of building hospitals. Exempting industrial machinery may help manufacturers expand local production. A waiver on security equipment can allow the government to acquire essential hardware without paying additional import charges to another government agency.
The economic argument is that the long-term public benefit may be greater than the immediate customs revenue forgone.
Why Customs is concerned about the exemptions
Customs is responsible for collecting import duties and other border-related charges. When the government approves exemptions, the agency’s potential revenue base becomes smaller.
The service generated about ₦4.5 trillion by June 30, 2026, against a full-year revenue target of ₦11.04 trillion. This left approximately ₦7 trillion to be collected during the second half of the year.
Waivers can make a demanding revenue target more difficult to achieve, especially when they cover goods with high values.
However, Customs acknowledged that fiscal incentives should not be judged only by the revenue they generate. Some waivers can stimulate investment, protect jobs and reduce costs in essential sectors.
The central question is whether the beneficiaries deliver the outcomes used to justify the exemptions.
Why ₦34 trillion does not mean ₦34 trillion was lost
The value of exempted imports is different from the amount of customs duty forgone.
Suppose machinery worth ₦100 million attracts a duty rate of 10 per cent. The value of the exempted import is ₦100 million, but the direct duty forgone is ₦10 million, excluding other charges.
Calculating the actual revenue effect of the 2025 exemptions would require information about the duty rate applicable to every product, the proportion exempted and any other levies that would have been collected.
Presenting the full ₦34 trillion as lost government revenue would therefore be misleading without additional evidence.
The government should publish both figures. Nigerians need to know the total value of goods covered and the estimated amount of revenue forgone.
When duty waivers become economically useful
A successful waiver should produce measurable benefits.
Industrial machinery exemptions should result in new factories, greater production capacity or more jobs. Medical waivers should lower equipment costs and improve access to healthcare. Agricultural or food-related exemptions should increase supply or reduce consumer prices.
CNG and electric-vehicle waivers should support cheaper transportation and reduce dependence on petrol and diesel.
If these outcomes occur, the government may recover part of the forgone revenue through company income tax, payroll taxes, value-added tax and wider economic activity.
The problem begins when companies receive waivers without making the promised investments or passing cost savings to consumers.
The risk of abuse
Import duty exemptions can create opportunities for favouritism, misclassification and diversion.
A company may receive approval to import machinery for production, but bring in items for resale. Goods intended for a public-interest programme may be diverted into the commercial market.
Businesses without political access may also be placed at a disadvantage if competitors receive exemptions that reduce their import costs.
This is why the waiver process must be transparent. The government should publish the beneficiaries, approved goods, estimated duty forgone, policy justification and performance conditions.
Commercially sensitive information can be protected without hiding the entire programme from public scrutiny.
What the government should do next
Nigeria needs a central, searchable register of fiscal incentives.
Each waiver should have a clear start date, expiry date and measurable objective. Beneficiaries should submit evidence showing how the incentive affected prices, employment, production or investment.
Waivers that fail to produce the promised outcome should not be renewed.
The government must also align its incentive policy with its revenue targets. Customs cannot be given an ambitious collection target while other arms of government repeatedly remove large categories of imports from the taxable base without adjusting expectations.
What this means for businesses
Legitimate waivers can lower the cost of investing in sectors considered strategically important.
Manufacturers, healthcare companies, clean-energy investors and transportation businesses should monitor available incentive programmes. However, applications should be based on genuine projects and supported by accurate documentation.
Companies should also expect stronger post-approval monitoring as public attention shifts from the size of the waivers to the value they created.