The Manufacturers Association of Nigeria (MAN) has kicked against the reintroduction of the four per cent free on board (FOB) charge by the Nigeria Customs Service (NCS), warning that the policy would significantly raise the cost of importing raw materials, machinery, and spare parts not available locally.
On February 4,2025, the NCS announced plans to implement a 4 percent charge on the FOB value of imports.
The plan was later suspended to allow for comprehensive stakeholder engagement and consultations regarding the implementation framework.
However, on July 23, 2025, the customs announced it will replace its seven per cent collection fees from the federation account and 1 percent CISS with a four per cent FOB levy at the port.
Reacting, the director-general of MAN, Segun Ajayi-Kadir in a report by NAN said the levy, which took effect on August 4, contradicts the Federal Government’s earlier suspension of the charge.
The director-general said the sudden reintroduction of the levy prompted the association to carry out a rapid technical assessment, which revealed “unsettling issues that could severely impact manufacturing.”
“The idea that the charge streamlines previous multiple charges and reduces cargo clearance costs does not reflect reality,” Ajayi-Kadir said.
“The fact is that the cost of the four per cent charge on a manufacturing company is enormously higher than the combined effect of the seven per ent surcharge and one per cent Comprehensive Import Supervision Scheme (CISS) levy.”
The MAN DG said other West African countries, such as Ghana, Côte d’Ivoire, and Senegal, peg inspection or collection fees between 0.5 percent and one percent FOB, with higher levies applied only to luxury or non-essential imports.
“The Nigeria Customs Service’s unilateral imposition of a uniform four percent FOB levy would raise the cost of doing business, encourage informal cross-border sourcing, lead to cargo diversion, and promote under-declaration,” he said.
Ajayi-Kadir urged the government and the NCS to halt the implementation until December 31 to allow for a proper impact assessment and consultations with stakeholders.
This, the MAN DG said, would determine an appropriate level of charges that would ensure the customs service performs efficiently.
“This timeframe would align with the January 2026 take-off date for recently introduced tax laws,” Ajayi-Kadir said.
“It would allow a proper technical session with strategic stakeholders to discuss issues vital to the survival of affected businesses in Nigeria and the development of business-friendly implementation guidelines.”
He recommended that the customs retain the existing 1 percent CISS plus a 7 percent cost of collection fee.
Ajayi-Kadir said the arrangement would balance government revenue generation with industrial competitiveness, while saving Nigerians from avoidable price increases.
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