Nigerian Manufacturers Urge Suspension Of 4% Customs Levy To Ease Economic Strain.
The Manufacturers Association of Nigeria (MAN) has called on the Nigeria Customs Service (NCS) to suspend the recently reintroduced 4% Free-on-Board (FOB) levy on imports until 31 December 2025, citing its potential to exacerbate economic challenges for the manufacturing sector. The appeal, articulated in a statement by MAN’s Director-General, Segun Ajayi-Kadir, follows the levy’s reinstatement on 4 August 2025, after its suspension in February due to widespread stakeholder opposition.
MAN argues that the 4% FOB charge, which replaced the 1% Comprehensive Import Supervision Scheme (CISS) fee and 7% cost-of-collection surcharge, significantly increases the cost of importing essential raw materials, machinery, and spare parts not available locally. The association’s analysis indicates that the new levy, applied to the total value of imports, is costlier than the previous structure for most industrial goods, except luxury items with duty rates above 35%. This could push import costs beyond the N6.6 trillion recorded in 2024, with the burden likely to be passed on to consumers, further fuelling inflation, which stood at 21.88% in July 2025.
The association highlighted that manufacturers are already grappling with a weak naira (over N1,540 to the dollar), alternative energy costs exceeding N1.1 trillion, and interest rates above 35%. A uniform 4% levy, MAN warns, risks undermining Nigeria’s competitiveness compared to West African peers like Ghana, Côte d’Ivoire, and Senegal, where inspection fees range from 0.5% to 1% for non-luxury goods. This could encourage informal cross-border trade, cargo diversion, and under-declaration, further straining the economy.
Compounding the issue, MAN pointed to persistent glitches in the NCS’s B’Odogwu platform, which have slowed cargo clearance, leading to demurrage costs and factory stock-outs. The platform’s lack of integration with agencies like the Standards Organisation of Nigeria Conformity Assessment Programme (SONCAP) has forced importers to rely on manual processes, fostering delays and inefficiencies. MAN also criticised the NCS for inadequate stakeholder consultation before reintroducing the levy, noting the absence of clear guidelines on compliance and cost implications.
Ajayi-Kadir urged the Federal Government to retain the previous 1% CISS and 7% cost-of-collection structure until the end of 2025, aligning with the planned January 2026 rollout of new tax laws. This pause, he argued, would allow for a comprehensive impact assessment and inclusive consultations to develop business-friendly guidelines. “The manufacturing sector is shrinking under these pressures,” he said, stressing that the levy contradicts the government’s Renewed Hope Agenda and industrialisation goals.
MAN proposed regular dialogue with the NCS and other stakeholders to prioritise trade facilitation over revenue generation, warning that unchecked costs could disrupt supply chains, increase unsold inventories, and deter investment. The association’s call for a suspension reflects a broader plea for policies that support Nigeria’s manufacturing sector, which it sees as critical to sustainable economic growth, job creation, and foreign exchange stability.
In response, the NCS has acknowledged the concerns, with reports indicating a possible review following consultations with the Finance Minister. Manufacturers remain hopeful that a balanced approach will emerge, safeguarding the sector’s competitiveness while addressing the government’s revenue needs.
