Nigeria’s import valuation complies with international standards – Customs
The Nigeria Customs Service (NCS) has assured Nigerian importers that the import valuation procedures adopted in the country were in line with international trade standards.
The Customs, in a statement by its Deputy National Public Relations Officer, Timi Bomodi, accused fraudulent importers of trying to misinterpret and twist import transaction values in order to shortchange government during duty valuation on imported cargoes.
Bomodi explained that, contrary to allegations that the Customs adopt non-methodical and arbitrary means to arrive at values, the service actually adopts the standard procedures designed by the World Customs Organisation (WCO) and World Trade Organisation (WTO).
He said: “Some unpatriotic individuals, engaged in the importation and clearing of goods, being poorly informed about the application of these valuation methods, have attempted to portray the Customs in bad light, by claiming that the valuation unit adopts non methodical and arbitrary means to arrive at values for Customs purposes. Nothing could be further from the truth.
“This assertion is bogus and untenable when examined through the prism of current global realities. When we look at data from the past three years, and focus particularly on the last two, we are confronted with massive schisms in global supply chain occasioned by the COVID-19 pandemic.
“Manufacturers in developed countries have had to cut down on production because of the difficulties experienced in moving parts and components across international borders. Except for medical equipment and supplies, most other goods have witnessed a decline in production.
“This situation has created scarcity of basic goods and services in most countries, thereby creating upward price swings. A classic example is the US auto industry that has seen steady increase in the prices of new and used vehicles as a result of interruptions in global supply chain.
“In spite of these obvious trends, the Nigeria Customs Service Valuation unit has, in recent times, been inundated with questionable requests for the acceptance of fictitious transaction values which bear no resemblances to global realities.
“Some unscrupulous importers and their agents have resorted to concocting values suitable only for their selfish ends, and solely for the purpose of evading the payment of appropriate Customs duty,” he said.
Bomodi added that value for customs duty is based on three components. One is the transaction value of the goods in question, also known as the cost, second is the value or cost of freight, and thirdly the value of insurance for the goods in transit. All three are captured as the Cost, Insurance, and Freight (CIF) value and forms the tax base for assessing duty.
He explained that, “since value assessments are based on the currencies of exchange when calculating duty payable on imports, we are compelled to also factor in the exchange rate. Even when the cost, insurance and freight values remain unchanged over time, the fact that the exchange rate varies, implies that there must be a commensurate increase in assessments and duty payable.
“We are aware that certain individuals and organisations deliberately make false attestations on their invoices and other final documents with the aim of evading the payment of duty and then turn around to blackmail the Service for querying their declarations. Like other attempts before it, this also will fail.
“The Nigeria Customs Service is bent on checkmating all attempts at duty evasion, and it is resolved in doing this in line with the principles outlined in international treaties and agreements.
“Since we all are in agreement as to the negative effect of the pandemic on global supply chain, and its effect on cost, insurance and freight, we should then not be surprised by adjustments made by Customs Valuation officers reflecting our current global realities.
“Therefore, anyone imputing ulterior motives to the actions of valuation officers, should themselves be viewed with suspicion,” he stated.