In a desperate move to further check hyper-inflation in the country, the Nigerian government is considering suspension of import duties and value added tax (VAT) on staple foods, drugs, agricultural and manufacturing inputs, and other essential goods.
The import duty and VAT relief will last for six months beginning from May to December 2024, according an executive document sighted by The Nigerian Economy today.
While President Bola Tinubu is yet to sign the document, The Nigerian Economy reports that the measure to suspend the taxes on essential goods is a measure to curb current inflation in the West African giant nation.
The document also includes plans to waive levies on fertilizers, poultry feed, flour, and grains.
The Inflation Reduction and Price Stability Order, as outlined in the document, will mandate the Ministry of Finance and the Central Bank of Nigeria to devise a plan for offering low-interest loans to the agriculture, pharmaceutical, and manufacturing sectors.
“This productive deployment will ultimately improve outputs and reduce inflation,” the document hinted.
The president is also likely to suspend VAT on automotive gas oil, some basic food items and semi-processed staple food items such as noodles and pasta, raw-material inputs for the manufacture of food items, electricity and public transportation, as well as agricultural inputs and produce and pharmaceutical products for the rest of the year.
The document also contained a measure to begìn importation of paddy rice into the country to make price of rice more affordable by the citizens.
The ASAP report recommended an executive order on the importation of paddy rice to millers to stem the growing tide of food inflation across the country.
The document also recommends the following:
Import duty & VAT suspension on specified items
Importation of paddy rice by millers
Import duty exchange rate peg
Meanwhile, the proposed plan by the federal government conflicts with earlier statements by President Tinubu on food imports earlier this year.
