Inflation: Tinubu Waive Duty, VAT On Essential Imports, Foods

BY GBOGBOWA GBOWA

There are indications that President Bola Tinubu may have taken the bold step to break the yoke of the persisting galloping inflation that has exposed citizens to excruciating hardship by suspending customs duty on variety of essential commodities, including manufacturing and essential agricultural inputs.

A proposal circulating on the internet believed to have been signed by the president also placed in abeyance for a period of six months, value added tax (VAT)  on the importation of staple food items and pharmaceutical products.

According to the Executive Order document, the import duty and VAT relief which will last for six months beginning from May to December 2024, could be extended until the president is satisfied that his administration’s objective for the tax holiday has been achieved.

Despite that Mr. President is yet to append his signature to the executive order, commendations have poured in from certain quarters, congratulating President Tinubu for taking the bull by the horn.

Analysts say the document which also includes plans to waive levies on fertilizers, poultry feed, flour and grains will push down the bitting inflationary trend and drive stability in the pricing mix.

Observers  believe that the development is coming on the heels of reported presidential directive to the Ministry of Finance and the Central Bank of Nigeria recently, to provide a working document to force down inflation and provide ordinary Nigerians some respite.

The presidential document also provided for implementation blueprint for the provision of low-interest loans for the agriculture, pharmaceutical and manufacturing sectors.

“This productive deployment will ultimately improve outputs and reduce inflation,” the document hinted.

Included in the document is recommendation to also suspend VAT on automotive gas oil, some basic food items and semi-processed staple food items such as noodles and pasta, raw-material inputs for the manufacture of food items, electricity and public transportation.

The document also contained measures to begin the importation of paddy rice into the country at zero duty to make its price more friendly and affordable by ordinary Nigerians.

Titled INFLATION REDUCTION AND PRICE STABILITY (FISCAL POLICY MEASURES, ETC.) ORDER, 2024, the document  also recommends the following:

Import duty & VAT suspension on specified items

Importation of paddy rice by millers

Import duty exchange rate peg

Sources contacted within the Nigeria Customs Service and the Central Bank of Nigeria say they are not aware of the order, and advised to wait, noting that if the Executive Order is real, they will be communicated.