Trade Facilitation as Casualty of Customs’ Revenue Targets

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Trade Facilitation as Casualty of Customs’ Revenue Targets

It has been an annual ritual for the Federal government to set revenue target for the Nigeria Customs Service. 

For each of these years, the Customs authority sets its officers on a wild hunt not only to meet the target but possibly, surpass it. 

And each successive Customs administration has acquitted itself credibly well in this task.

 Year in year out, Customs authority has harvested humongous amount of money into the Federal government coffers as its annual revenue hauls. 

But for this feat, the greatest casualty has been trade facilitation which has been subjected to continuous battering.

The hunt for revenue by the Customs has been taken to higher notch under the leadership of the incumbent Comptroller-General, Hameed Ali. 

 

Ali, a retired Colonel of the Nigerian Army, became the Customs helmsman on August 27, 2015 and since then, he has pursued revenue with an uncommon gusto. 

Between 2015 and 2018, a cumulative sum of N4.042 trillion had been raked into the government coffers.

 

The Customs, under Ali, has consistently hit the trillion Naira mark, since 2017 when the agency grossed N1.037 trillion and 2018 when it garnered the sum of N1.202 trillion.

This was unlike 2015 when the agency had N904.072 billion and 2016 when the sum of N898.673 billion was realised.

 

In all of these, the importers have always received the short end of the stick. 

The scenario however got dramatic this year when, for the first time in the history of the service, it got two different revenue targets for the year.

 In January 2019, as it was customary of the Federal government, it gave a revenue target of N887 billion to the Customs for 2019.

 

But in October, two months to the end of the revenue year, the National Assembly changed the figure to an unprecedented N1.5 trillion.

The Chairman, Senate Committee on Finance, Senator Solomon Olamilekan, said the decision to shift the goal post in the middle of the game was due to the impressive revenue performance of the Customs, whom he said had garnered the princely sum of over N900 billion as at September, 2019.

But to the discerning minds, the reason for the revenue hike, which was a novel development, was more of the impression sold to the law makers by CGC Ali, a few days earlier, that the Service has the capacity to generate more revenue that would be higher than the Federal government target.

 

On October 2, 2019, Ali, while  appearing before the  Senate and House of Representatives Joint committee on Finance and National Planning, had boasted that the daily rake-in of the Customs since the borders were closed, now hovers between N4.7 billion and N5.8 billion.

This made the eyes of the law makers, who were looking for a way to hike the 2020 National budget, to pop out. 

Ali further put the icing on the cake when he bragged that the service even realised a mouth-watering sum of N9.2 billion in one day in September.

 

This was what the law makers needed to slam higher revenue target on the Customs.

Ali may have come off that meeting with the lawmakers with high rating but he has succeeded in compounding the misery of importers and their agents who have continued to live under the Jack boot style of Ali’s administration and revenue generation.

No sooner the law makers made the announcement of the new revenue target than Ali revved his revenue hunting engine to a crescendo.

Pronto, the Federal Operations Units (FOU) of the service launched into hot chase of owners of exotic cars all over the country.

 

In a gestapo manner, car marts were closed indiscriminately across the country while hotels were raided where cars parked at the premises were impounded.

The victims of these raids were told to show evidence of payment of customs duties on vehicles they may have genuinely thought they bought legitimately.

Defaulters were given concession to pay for the duties with the additional 25 percent penalty.

We are sad at this high pitched race of the Customs to meet the newly imposed revenue target.

We are  more saddened by the wilful decapitation of trade facilitation, which is  one of the sacred duties of the Customs, on the altar of revenue generation. 

 

CGC Ali, has unwittingly, through his claims of higher daily revenue figures of which we find spurious, put his officers under undue pressure to meet the target.

As has always been the case, this pressure would be transferred to the importers and their agents who will be stretched to the limits in the course of goods clearance process.

In as much as we acknowledge that revenue generation is one of the functions of the Customs, we are equally aware that trade facilitation is the responsibility of the agency which we believe should be given as much importance and with equal gusto.

 

As a matter of fact, the World Customs Organisation (WCO) and World Trade Organisation (WTO) are urging and encouraging member states to pay more than passing interest on trade liberalization and facilitation.


This is more germane in the quest of the two international bodies to remove trade barriers among member nations and promote inter- regional trade cooperation.

Customs organisation in each country is therefore encouraged and primed by the World Customs Organisation (WCO) to play a pivotal role in achieving the objective of trade liberalization and facilitation.

The importance of the Customs organisations in this respect is further accentuated by the proliferation of Regional Trade Agreements (RTAs) whose objective is to increase trade among countries in these regions through elimination of trade barriers.

While other Customs authorities in most member nations of WCO have keyed into the objective of the World Customs body by playing up their trade facilitation role, the reverse is the case with the Nigeria Customs Service.

 

Not until the Nigeria Customs Service ceases to pay lip service to trade facilitation that our ports will attract more patronage than it presently enjoys.

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