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COVID 19:  FG considers tax holiday for maritime sector


Peter Olaniyi   |   

In a bid to stimulate investment and boost activities in the maritime industry, amid the downturn induced by COVID-19, the Federal Ministry of Transportation is seeking a package of tax incentives for the sector.

Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh, who conveyed the Ministry’s position to the Honourable Minister of Finance, Hajiya Zainab Ahmed, in Abuja, reiterated the commitment of the Honorable Minister of Transportation, Rt. Honourable Rotimi Chibuike Amaechi towards ensuring the growth of maritime in Nigeria.

He said many governments around the globe had introduced massive tax reduction or elimination to spur activities in key sectors and rev up their economies during the coronavirus pandemic.
Dr. Jamoh stated, “The maritime sector is critical in the growth and development of transportation and, by extension, international trade in the country.
“Thus, the need for Federal Government-oriented programmes and stimulus packages to deliver a response that catalyses a sustainable economic development cannot be overemphasised.”
The DG said the proposed incentives included zero import duty for brand new vessels imported by Nigerians or Nigerian shipping companies for use in foreign or domestic trade; 0.5 per cent only import duty for vessels aged between one and five years intended for use in foreign or domestic trade; and one per cent only import duty for vessels aged between five and eight years intended for use in foreign or domestic trade.There was also a proposal for zero import duty for parts or components imported by Nigerian shipyards for local ship building, which will be for an initial period of four years after which it can be reviewed by government. All these are expected to give the sector the vibrancy it needs for growth.

The NIMASA DG said the incentives were being proposed because of the importance of the Nigerian maritime sector to the entire sub-Saharan African region.

He emphasised that Nigeria accounted for more than 65 per cent of the entire shipping trade of the sub-African continent. Nigeria is also the largest producer and exporter of oil and gas in the continent and Africa’s largest economy.
“It is worthy of note that the maritime sector is a crucial energizer of economic growth and development, as it facilitates trade between countries.
” The Nigerian economy has witnessed substantial growth in the last two decades owing to reforms that boosted private investment in the maritime industry” Jamoh noted

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Shippers Council threatens to shut Denca Terminal over illegal charges. Peter Olaniyi The Nigeria Shippers Council (NSC) has threatened to seal up non compliance off dock terminals over defiance to refund storage charges to shippers as well as lack of adequate handling equipments among others. Speaking during a tour of some bonded terminals in Lagos, the Executive Secretary of NSC, Barrister Hassan Bello, stated that the council insisted that it is the responsibility of terminal operators who stemmed cargoes to bonded terminal to pay and not shippers while insisting that money collected from shippers be refunded back to them. Speaking specifically at Denca bonded terminal, Bello informed that the terminal is owing up to about N42 million terminal charges that is yet to be refunded to the shippers. While stating that failure of the terminal to adhere to the memo issued by the council, will likely lead to ceasing of the terminal license. Bello, who also lamented the poor state and location of some of the bonded terminals, urged the Nigeria Customs Service (NSC) to always carry the council along before issuing license to the bonded terminals. He informed that the council will begin to post its staff to the bonded terminals to monitor and enforce efficiency at the terminals. According to him “Am particularly not happy with the arrangement that is going on between the seaport terminals and bonded terminals, each one trying to pass the bulk on transfer and storage charges, and what we are saying is that our circular which we issued in July will have to suffice for this exercise, no storage charges no transfer charges if goods are stemmed from the seaport terminal, those who stemmed the goods are responsible for whatever cost and not the shippers “So it is between the seaport terminal and the offdock terminal, there must be a standard operating procedure and a memorandum of understanding. ” I think what has been happening between the two is informal arrangement and we cannot have informal arrangement, the shipper cannot pay for what is not his responsibility “He has already nominated in his bill of laden or contract of affreightment where his cargo should go, and to transfer that cargo to another terminal, it has to be the business of the first terminal he has nominated. “It cannot be otherwise, so going through the issues tomorrow meeting will be instructive, because NSC believes in consultation and negotiations, but if for any other reason we found out that the seaport terminal or the bonded terminal is charging these fees which we have abolished, then NSC will be left with no options than to take very strict measures and that measure will include sealing of recalcitrant operators who have defiled genuine orders of NSC. “We are posting staff of NSC to all these bonded terminals to monitor and enforce efficiency. “Also some of these bonded terminals are not properly situated because there are no access to the terminal and you see the whole place not looking nice, so it is also our duty to work with Nigeria Customs that licensed them to ensure that whenever a bonded terminal is to be licensed, it’s geographical location suitability must be taken into consideration “We are now facing traffic in Apapa, we may be facing traffic where the bonded terminals are situated so I think that we are going to discuss with NCS to see that we are consulted before issuing licensed to these bonded terminals. “The same thing with equipment, we need to see that they are of standard. “Some of the arrangements are weak and we are coming very hard on them to obtain international standards”. Commenting on the deplorable states of the Denca bonded terminal , the NSC boss said “I have talked with the officials here that for them to operate we will write our report on some of these issues and we will make sure that the existence of a bonded terminal depends on the standard that is maintained internationally, if not we will recommend that the terminal license be seized. “We have about N40 million of shippers charges that has not been refunded. “At the meeting, we will decide but we cannot allow bonded terminal or any terminal of that nature to act against the rules and regulations of engagement. “Shippers, Freight Forwarders cannot be cheated just like that and I promise you will see more improvement or consequences” he said. Speaking earlier, the Managing Director of the Denca bonded terminal, Mr. Tony Asiadiachi stated that it was the seaport terminal that instructed them to collects the fee from the shippers, stating that some of the consignment carries storage which they pay before carrying it, which is later now transferred to the owners of the cargoes.

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