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By Kabir Abdulsalam
The House of Representatives, in 2022, aimed high for the Nigeria Customs Service (NCS). Under the leadership of Leke Abejide, the House Committee on Customs and Excise set an ambitious revenue target of N3.01 trillion for the 2023 budget, a significant increase compared to previous years.
This ambitious goal came after Abejide challenged former Comptroller-General Col Hameed Ali (rtd) about the low N1.465 trillion target presented for 2021, citing favorable economic conditions like a reduced levy on new automobiles and Naira devaluation.
The House eventually settled on a more modest increase, raising the target to N1.678 trillion.
This push for increased revenue can be understood within the context of the NCS’s historical performance. Data compiled by Ship & Ports reveals that the service generated a total of N13.169 trillion from 2010 to 2021.
While the early years saw steady growth, with figures surpassing N500 billion by 2011 and reaching N800 billion by 2012, it wasn’t until 2017 that the NCS broke the trillion-naira barrier. From there, revenue steadily climbed, culminating in a record-breaking N2.24 trillion in 2021.
It’s worth noting that a significant portion of this revenue comes from the southwest region of Nigeria, with over 80% generated by the top four revenue-collecting commands, all located in Lagos. This geographical concentration highlights the importance of diversifying revenue sources and fostering economic growth across the country.
Subsequent data from the National Bureau of Statistics (NBS), published in April 2023, indicated that the Service achieved an even higher mark, exceeding the previous record with N2.60 trillion in revenue generation.
However, a change in leadership occurred with the transition of power on May 29, 2023. President Bola Tinubu took over from Muhammadu Buhari, and on June 19th, Bashir Adewale Adeniyi was appointed as acting Comptroller-General.
Adeniyi, a seasoned officer with over 30 years of experience, was officially confirmed on October 21st. Upon his confirmation, he pledged the service’s commitment to meeting and exceeding revenue targets, emphasizing the importance of minimizing deviations.
The crucial role of the NCS in Nigeria’s economy cannot be overstated. With dwindling oil sector revenue, the customs system becomes even more significant in determining the efficacy and success of the country’s operations.
As stakeholders often say, the NCS functions like guiding stars in the night sky, illuminating the path toward financial stability and prosperity
The role of the NCS extends far beyond just generating revenue. While targets and figures remain crucial markers of success, stakeholders argue that they also serve as catalysts for innovation, efficiency, and international compliance.
These ambitious goals shape policies, forming the bedrock on which nations collect revenue, facilitate trade, and safeguard national security interests.
In the absence of abundant oil or robust revenue from the Federal Inland Revenue Service, FIRS, the NCS becomes even more pivotal, contributing significantly to Nigeria’s fiscal policy and overall stability.
This critical role was underscored during Comptroller-General Adeniyi’s briefing to the House of Representatives Committee on Appropriations in late 2023.
While proposing a N5 trillion revenue target for 2024, Adeniyi acknowledged the lawmakers’ ambition of achieving N6 trillion to support President Tinubu’s N27.5 trillion budget.
To bridge this gap, he suggested generating an additional N1 trillion by lifting the suspension of duty on single-use plastic and increasing import duties on alcohol and tobacco.
However, this ambitious goal, a significant leap from the 3.1 trillion naira generated in 2023, has raised eyebrows and sparked both optimism and skepticism across the nation.
To counter these challenges, the service has embarked on a multifaceted approach. Deploying technology-driven solutions, collaborating with international agencies, and implementing stringent enforcement measures stand as pillars in the quest to meet the 5.1 trillion naira revenue target.
Adeniyi, when recently questioned about this surge, proudly pointed to the service’s impressive 21.4% increase in revenue collection during the fiscal year 2023.
This performance, he asserted, reflects the NCS’s unwavering commitment to optimizing revenue generation for the Federal Government and solidifying its role as a cornerstone of Nigeria’s economic well-being.
He said: “In the fiscal year 2023, the Nigeria Customs Service (NCS) achieved a significant milestone by recording a total revenue collection of NGN 3,206,603,417,315.47, marking a noteworthy 21.4% increase from the preceding year’s total revenue of NGN 2,641,616,673,501.83.
“This growth aligns with the NCS’s consistent upward trajectory, as evidenced by a 17.88% revenue increase in 2022.
“At the beginning of July, excise on single-use plastics products was suspended. We believe that if the suspension is lifted, something in the region of N300 billion can be realized from single-use plastics alone.
“The excise duty on alcohol and tobacco. There is a projection to increase it to 30 percent. If this is done, we expect that revenue will get to where we want it,” the CG said.
He attributed the significant revenue increases to several factors, including improved officer morale across the country.
These included an array of welfare programs and initiatives, such as the housing project, recognition programs, and awards that celebrate exceptional performance, dedication, and achievements.
Adeniyi’s vision for achieving the ambitious N5.1 trillion target goes beyond simply setting bold figures. He has outlined a multi-pronged strategy focused on boosting efficiency, tackling trade facilitation challenges, and fostering collaboration throughout the ecosystem.
Some of the key reforms he has deployed include: Modernizing data collection and surveillance systems: Upgrading technology infrastructure and leveraging data analytics will be crucial for pinpointing smuggling activities and optimizing resource allocation.
He has strengthened collaboration with other security agencies to enhance cooperation with other law enforcement bodies to create a more formidable defense against illegal trade and improve border security.
Similarly, Adeniyi has also streamlined customs processes to reduce clearance times and simplify regulations to significantly benefit legitimate businesses, encouraging trade volume and compliance.
His stride on Investing in trade facilitation initiatives, modernizing infrastructure, implementing automation, and providing training has also further smoothed the flow of goods and boosted economic activity.
These internal efforts alone won’t guarantee success. The private sector’s role is equally vital. Enhancing trade compliance, adopting ethical practices, and actively collaborating with the NCS is crucial for building a robust and transparent customs system.
The N5.1 trillion target stands as a critical juncture for Nigeria’s economic future. Challenges lie ahead, from overcoming infrastructural limitations to addressing corruption concerns.
However, success is achievable through sustained collaboration between the NCS, the private sector, and the Nigerian people. The choices made today, the reforms implemented, and the commitment demonstrated will ultimately determine the final paragraph in the evolving narrative of Nigeria’s economic evolution in 2024.
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