What you should know about new Customs Act

Former President Muhammadu Buhari on May 23rd, 2023 assented to the Nigeria Custom Act after rejecting assent for a record four times.

Daily Trust on Sunday reports that the President cited certain irregularities with some sections of the Act as his reason for declining assent.

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In 2022 alone, the former President rejected the amendments to the Customs Act twice in July and October, citing disagreement with several clauses including 4(b), 7(2), 7(3), 10(1)(a), 10(1)(b), 12, 14(1)(g), 16(3), 17(4), 18(1), 18(3), 18(6)(c), 111(3), 165(5)(a), 170(1)(a), 171, 175(1)(2), 180, 181, 184, 189, 194, 279 and 181.

The new legislation which has now become the first amendment to the Customs Act in over 64 years, is expected to introduce fundamental changes to the operations of the Nigeria Custom Service (NCS).

The Bill to amend the Act was sponsored by former chairman of the House committee on Customs, Hon. Leke Abejide.

Here, Daily Trust on Sunday highlights major amendments in the Customs Act that will shape its operations.

4 per cent free-on-board import value

In the new Act, the Federal Government granted an additional four per cent of Free-On-Board (FOB) value of imports handled by the Nigeria Customs Service (NCS). The fresh four per cent incentive for Customs is outside the existing seven per cent cost of excise duty collection statutorily undertaken by the Service.

Section 18 of the Act, which provides for a sum not less than four per cent of the Free-On-Board value of imports, was in accordance with the international best practice. The Customs had said that the funds would be part of what the service shall keep and maintain for its operation.

The 4 per cent free on-board import value is expected to provide additional funding for the Service to carry out key and emergency projects.

Expenditure and submission of audited accounts

In the new Act, the Service is mandated to prepare and forward to the National Assembly no later than 30 September in each year, an estimate of the expenditure and income of the Service during the succeeding year.

Also in the New Act, the Customs are required to publish their audited accounts.

“The Service shall cause to be kept proper accounts and proper records and when certified by the Board, the accounts shall be audited by auditors appointed by the Service in accordance with the guidelines supplied by the Auditor General for the Federation.

“The Service shall not later than three months before the end of each year, submit to the National Assembly a report on the activities and the reports. administration of the Service during the immediate preceding year and shall include in such reports, audited accounts of the Service and the Auditor’s report on those accounts,” Section 21 of the Account said.

Customs CG to be appointed among serving officers

Another distinct provision of the Act is the provision that the appointment of the Comptroller General of Customs will no longer be thrown open to non-career individuals. The new Act provides that the President will appoint a Comptroller General of Customs from among career serving officers of the Service not lower than the rank of Assistant Comptroller General (ACG).

Recall that the immediate past CG of Customs, Col. Hameed Ali (Rtd) was appointed from outside the Service, a development that had raised eyebrows especially as a result of him refusing to wear the Customs regalia throughout his almost eight year reign.

Penalties

Section 206 of the New Customs Act highlights stiffer punishments and sanctions for violators of the laid down laws and regulations on Excise duty unlike what is obtainable in the old Act.

In the new Act, it provides for sanction of about N5,000,000 for violators unlike in the previous Act written in 1958 which provides very little sanctions of which some were written in pennies.

It said “An excise license holder who contravenes any of the provisions of the Customs excuse duty is liable on conviction to a fine of N5,000,000 and N50,000 for every day of default and imprisonment for a term of three years.

Section 208 of the New Act also provides that “Where goods declared in accordance with Excise duty requirements are found whether after their removal from the premises of manufacture not to correspond with the declaration made, the goods shall immediately be forfeited.”

This Explainer is produced in partnership with the Centre for Democracy and Development (CDD)

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