Senate yesterday urged the Federal Government to direct the Nigeria Customs Service, NCS, to suspend the lifting of ban on importation of rice through the land borders.
The upper legislative chamber, which received the report of its Ad-hoc Committee on Import Duty Waivers, Concessions and Grants, headed by Senator Mohammed Adamu Aliero (APC Kebbi Central), said it took the step having considered the grave implications of lifting the ban.
Presenting the committee report on behalf of the chairman, Senator Tayo Alasoadura (APC Ondo Central) noted that lifting the ban would lead to evasion of custom duty and revenue losses to Nigerian maritime industry.
Similarly, the committee said lifting the ban will directly lead to increased diversion of vessels to neighbouring countries.
It added that the lower five percent import levy being charged on rice by some neighbouring countries is enough inducement that “if not checked will on the long run lead to massive vessels desertion of Nigerian ports and the concomitant unemployment of Nigerians”.
Customs was said to have claimed that the removal of the restriction will bring more revenue to the coffers of the government, reduce the number of smugglers and also bring down the price of the commodity by breaking the monopoly being enjoyed by the big time rice traders (millers) who have the capacity to import large consignment.
The Senate had on October 15, 2015 deliberated a motion on the dangers posed by the removal of rice from import restriction list and the re-introduction of import duty payment at land border and asked its ad-committee to invite the Comptroler-General, NCS to brief it on the reasons behind the new policy.
The committee noted that between 2010 and 2012, there were inconsistencies in fiscal policy measures on rice imports.
According to the committee, the policies brought about frequent changes in levy payable on various forms of rice with conflicting opinions of the classification of Husked brown rice.
It noted that it was as a result of such policy somersault that the Customs, as implementing agency of government fiscal measures, recommended the restriction of rice imports to the nation’s sea ports as a way of channelling the importation of rice.
The committee said that due to the policy somersault, some importers exceeded their quota allocation resulting in outstanding duty of over N24 billion and subsequent suspension of the 2015 Rice Import Quotas.
It observed that the introduction of the 2014-2017 National Rice Policy has brought about stability in the tariff regime.
The committee said that it fought out that, though the NCS claimed to have been well equipped to monitor the land borders, “however, the Customs Service failed to convince the committee of its ability to actually monitor the porous borders”.
“Therefore, the committee doubts their assumed capacity given previous record of collusion with smugglers. If the efficiency is there prohibited frozen chicken and other contra banned would not have flooded our markets”, the committee said.
The committee said that it discovered that any importer that imports five to 10 ship load/vessel of rice into Benin Republic and destined them to Nigeria through the land borders already had predetermined motive to cheat Nigerian government of revenue through duty evasion”.
It, however, said there is justification for any importer to import parboiled rice that is meant for Nigeria, discharge it at Cotonou, pay import duty at five per cent and load the same consignment into trucks where he pays transportation cost of an average of N400,000 per truck to the Nigerian border and on arrival pay another import duty of either 30 or cent or 70 per cent.
“The committee does not see any logic in this”, it submitted.
In their contributions, Senators Shehu Sani (APC Kaduna Central), Bassey Akpan (PDP Akwa Ibom North-East), Barau Jibrin (APC Kano North), urged encouragement of local rice production for food sufficiency and additional job creation in the country.
Senate President, Dr. Abubakar Bukola Saraki, who summed up contributions by senators said that the matter is serious because it affects revenue and improvement of agriculture in the country.
He said that sentiment should be removed completely from the consideration of the report, adding that no genuine importer would prefer to import through the land border to incur extra cost unless there is intention to defraud the country.
The senate president said that lifting the ban on land border importation of rice is definitely not in the interest of the economy of the country.