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Uche Usim, Abuja
Seekers of import duty exemption will henceforth have to apply electronically, as the Federal Government launches a new online platform through which the Import Duty Exemption Certificate (IDEC) will be issued.
The move is to check abuses and revenue loss of over N1 trillion in recent times.
Speaking at a stakeholders meeting as a prelude to the launch of the project at the weekend in Abuja, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said her Ministry receives upwards of 600,000 different requests on an annual basis for import duty waivers on imports from different government agencies, the private sector and Non-Governmental Organizations (NGOs) through its fiscal policy measure of granting waivers.
“Despite these huge figures, it is still not clear what benefits have accrued to government in return in terms of jobs created, additional tax revenues paid by beneficiaries and other impact to the economy,” Ahmed said.
“The process of applying for and processing of waivers, determining eligibility of applicants, validating previously granted waivers, reporting utilisation of waivers are currently all manual. This results in lack of
transparency and lengthy bureaucratic process that could take upwards of usually between 60 to 180 days, thereby exposing the process to subjectivity and abuse.”
The Minister said plans were afoot to formally launch the project in the first quarter of 2020, since it has already secured the approval of the Federal Executive Council (FEC).
“So, there is a need to brief all stakeholders on where we are and where we intend to be as soon as the IDEC/VREG Platform is launched,” she said.
“This meeting couldn’t have come at a better time now that the Federal Government, through the Ministry of Finance, Budget and National Planning, is planning to officially launch this project, owhich intends to reposition the administration, application and processes of acquiring Import Duty Exemption Certificate (IDEC) in Nigeria.
“As you all know that Import Duty Exemption Certificate is a tool used by the Federal Government in achieving some of its fiscal policies of increasing economic activities and employment generation in some target sectors.
“Note that from 2011 to 2015, which is a four-year period, government conceded about N1.024 trillion through grants of only four types of waivers,” she explained.
The Minister, who was represented at the event by the Permanent Secretary, Special Duties of the Ministry, Mr Muhammed Dikwa, said the government has engaged Messrs FourCore Technology Solutions Limited to develop and manage a solution that makes the process from application to processing, granting, validating, renewing and checking levels of utilisation much easier and faster by utilizing and integrating a set of technology tools and applications.
“Messrs FourCore Technology Solutions Limited was charged with providing the infrastructure to automate the entire process end-to-end, including a dashboard that provides empirical data to measure the impact of this Fiscal Policy lever to the economy.
“Besides investing in the technology to achieve this goal, the Ministry also invested in the digitalization of all past IDEC records and procuring the necessary technology for the responsible principal officers including an IDEC Processing Centre situated at the Ministry of Finance, Budget and National Planning. At-the point of deployment of this solution, it became apparent that the process requires management because there are varied connectors to this service both internationally and locally for the process of import duty verification and validation.
“To this end, the Ministry has decided to engage Messrs. FourCore who designed and built this solution for process management. As a result, we have reduced the processing time from an average of 60 days to about three to five working days for granting waivers,” she added.
Ahmed also disclosed that the project has a second component, which is the Vehicle Identification Number Registration (VREG) that seeks to provide a national repository of all VINs in the country including the ones coming in through the ports of entry.
“Vehicle importation accounts for about 30% of the total import duties alone, representing a significant portion of our total import. A national VIN system provides a centralised registry that draws historical data from a global VIN repository to keep track of vehicles coming in and out of the country. The VIN registration process also serves as a check for all smuggled vehicles into the country, as it provides a unified
database for all vehicles independent of their point of entry and provides a basis for Nigeria Customs Service (NCS) to effectively collect duties on smuggled vehicles.
“Due to the automation of this process, we have increased the level of visibility into the entire process, reducing discretion that the system has become accustomed to and increasing accountability to unprecedented heights.
“This will not only contribute to the present efforts by government towards ease of doing business but also generate additional revenues contributing to the current effort in revenue generation through the
Ministry’s Strategic Revenue Growth Initiative (SRGI).
“In addition to providing the Nigeria Customs Service (NCS) with guidance on all vehicle related duties and levies, the VREG component will provide the nation with a vehicular asset registry, which can be leveraged for the purpose of movable asset valuation, insurance, taxation and correct assessments. VREG in addition will also provide a single window to access VIN related information, which will be relevant to the VIO, Police, FRSC, insurance bodies, tax and security agencies to enable visibility to curb incidences of theft, vehicle licencing information duplication, insurance fraud and comprehensive enforcement of vehicle duty payments independent of mode or point of entry into Nigeria,” she stated.
