Customs Upped Revenue Collection By 21.4% ’23, Sets #5tn For ’24
BY EGUONO ODJEGBA
The Comptroller General of Customs, Bashir Adewale Adeniyi MFR has said that the revenue collection duty of the Nigeria Customs Service, NCS, peaked with an impressive 21.4percent rise in 2023, amounting to a total collection of #3,206,603,417,315.47 as against the sum of # 2,641,616,673,501.83 collected in 2022.
The CGC at a press briefing in Abuja Wednesday declared that the increment is consistent with the service’s upward trajectory, which he said gained a 17.88% revenue increase in 2022.
“The consecutive expansion in revenue underscores the Service’s sustained efforts in optimizing revenue collection for the Federal Government and exemplifies our ability to adapt to dynamic economic conditions.”
However, Adeniyi also disclosed that the NCS recorded a revenue shortfall of NGN 532 billion in the first half of the year, resulting the short fall of the projected revenue target of NGN 1.84 trillion; which he attributed to a number of operational factors”, he said.
Juxtaposed against the identified said challenges, the customs boss expressed satisfaction with the scale up for 2023 while noting that no effort will be spared in maintaining the traction and making 2024 scorecard in revenue collection and its overall deliverables, as outstanding.
“This achievement is particularly remarkable given the challenges within the operational environment. Operational challenges such as lower transaction volumes, compliance issues, inadequate infrastructure, and capacity gaps were compounded by delays in policy implementation and socio-political factors.
“The anxiety associated with a major election year, the prolonged cash crunch linked to the introduction of higher denominations of the new Naira bills, temporarily impacted purchasing power and overall economic activities.
“The transition of power to the President Tinubu-led Administration brought about new policy direction, including the removal of fuel subsidy, the floating of the exchange rate, and the closure of Nigeria’s Northern borders with Niger Republic, adding another layer of complexity”, he added.
Speaking further on its revenue performance for the year ended 2023 and the attendant deficit, Adeniyi explained that strategies have been put in place to continue to improve on its collection system and implementation mechanism.
“These challenges led to a revenue shortfall of NGN 532 billion in the first half of the year, falling short of the projected revenue target of NGN 1.84 trillion. However, a positive transformation occurred in the later part of the year, following my appointment as the Comptroller-General in July.
“This was accompanied by a merit-based reconstitution of the management team, resulting in a significant shift that enabled the Service to exceed monthly revenue targets by 6.71% for the first time in 2023. Monthly revenue collection for the latter half of the year averaged NGN 332.9 billion, a substantial increase from the initial NGN 201.7 billion recorded in the first half of the year.
“This positive trend can be attributed to strategic measures, including the immediate establishment of a Revenue Review Recovery Team and the dissolution of existing Strike Force Teams, streamlining enforcement under the Federal Operations Unit (FOU). Additionally, strategic reassignments of Customs Area Controllers, the creation of an ideas bank, and extensive stakeholder engagements collectively contributed to this impressive resurgence.”
Continuing the customs boss said, “The improved revenue collection in the latter half of 2023 played a crucial role in significantly reducing the revenue shortfall by 10%, decreasing from NGN 532 billion to NGN 478 billion by year-end. This calculation is based on the government’s projected revenue collection by the Nigeria Customs Service (NCS) of NGN 3.684 trillion and the actual collection of NGN 3.206 trillion.”
He further explained additional technical factors that drove the revenue downward trend for 2023 to include various fiscal and monetary measures.
“Moreover, the deficit in NCS revenue collection can be ascribed to deliberate government initiatives and incentives designed to foster the growth of various sectors within the economy. Specifically, the government approved a concession of NGN 2 trillion, incorporating select dutiable items under the new Tariff heading Chapter 99.
“This policy shift resulted in the exemption of duty payments on certain dutiable goods, previously falling within a duty range of 5% to 10%. The overarching objective of these granted waivers and concessions was twofold: to stimulate development across diverse economic sectors and to bolster the nation’s overall peace and security.”
In the area of anti-smuggling activities, the CGC also scored the NCS high, declaring a total of 3,806 seizures with a cumulative Duty Paid Value of N16, 049,023,262 for the period under review.
“The NCS sustained its vigorous campaign against smuggling and illicit trade, culminating in 3,806 seizures with a Duty Paid Value totaling NGN 16, 049,023,262. These confiscations encompassed a diverse array of contraband, including Arms and Ammunition, Artifacts and Antiquities, illicit drugs, expired food produce, and endangered species of flora and fauna.
“Remarkably, the NCS achieved 52 convictions, with 11 specifically linked to the illicit trade in Animal/Wildlife. Noteworthy is the international acknowledgment garnered for the Service’s efforts in combating this illicit trade in Animal/Wildlife. “This steadfast commitment underscores the NCS’s dedication to protecting Nigerian society, maintaining a resolute stance against smugglers, and diligently dismantling their operations”, he said.
He outlined a number of strategic measures the customs plan to implement to boost its overall task while maintaining effective partnership and purposeful engagements in the light of aligning with the objective of the federal government through other critical economic links; inclusive of all legislative businesses as they affect the national economy.
“Going forward, numerous strategic initiatives are poised to positively impact the Service’s performance in the coming months. These initiatives include the introduction of the Advanced Ruling system, aligning NCS operations with
global best practices and meeting the recommendations of the World Trade Organization Trade Facilitation Agreement (WTO TFA).
“Additionally, the inauguration of a Steering Committee on the Implementation of Authorized Economic Operators (AEO) for Compliant Traders underscores our readiness to transition from Fastrack 2.0 to the AEO concept. Engagements with the international community, such as those with the World Customs Organization (WCO), JICA, and Japan Customs, focused on key areas is expected to lead to the implementation of the Customs Laboratory, adoption of geospatial technology, and the conduct of a Time Release Study.
“Collaborative efforts with the Customs Administration of the Republic of Benin, the revitalization of zonal structures, and integration of Customs institutions into the administrative framework all contribute to NCS’s commitment to efficient service delivery and positive stakeholder relationships.”
On the various legislative instruments, he said, “The NCS also responded to changes in legislation, engagement with the National Trade Facilitation Committee (NTFC), initiated Corporate Social Responsibility projects, integrated efforts with the Federal Road Safety Corps (FRSC), enhanced personnel welfare programs, and introduced the Work-Life Balance (WLB) initiative. In the upcoming week, the NCS is set to inaugurate an electronic auction (e-auction) platform, strategically designed to enhance transparency in the auction process. These collective actions signify NCS’s dedication to enhancing staff welfare and sustaining optimal performance.”
“Notwithstanding these concerted efforts, NCS is also conscious of the topical trends and issues that will impact the Service operations in 2024. They include:
Alignment with Government Policy Direction. The President Bola Ahmed Tinubu Led Administration has identified eight priority areas, including food security, poverty eradication, growth, job creation, access to capital, inclusion, rule of law, and fighting corruption. In addition to these priority areas, NCS has identified 21 relevant areas outlined in the Policy Advisory document.
“These areas will continue to shape NCS’s operations throughout 2024, aligning with the broader policy goals of the government.”
While expressing optimism at the prospect of achieving its revenue projection, trade facilitation as well as maintaining national security under his administration’s strategic agenda balancing, he note that the NCS will continue to adapt to prevailing realities that surrounds international trade and customs administration.
“As we advance in 2024, the NCS is committed to strategically charting its course for the future. The global and national trends, including the AfCFTA and WCO theme, will shape customs operations. The focus remains on aligning NCS activities with government policy, enhancing stakeholder engagements, and fortifying operational preparedness through technological advancements and capacity building.
“The NCS will continue to adapt to emerging challenges, foster collaborations, and uphold its commitment to integrity and administrative procedures. The outlined strategies, coupled with ongoing initiatives, are poised to facilitate the achievement of the newly set revenue target of NGN 5.079 trillion for the fiscal year 2024. The Service invites all stakeholders to actively participate in this collective journey towards a more efficient, transparent, and revenue-optimized customs operation for the benefit of the nation.
“In the face of these goals, I must emphasize that the NCS will maintain a zero-tolerance stance towards indiscipline and non-compliance in the year 2024. It is imperative for all officers and stakeholders to adhere strictly to established procedures and regulations. Maximum cooperation is expected from every stakeholder in the customs operations”, adding:
“The success of our collective efforts depends on the discipline and commitment of each member. Let this be a year where every action is aligned with the principles of efficiency, transparency, and revenue optimization with the overall aim of contributing meaningfully to the economic prosperity of our nation.”