Price hike looms as CBN raises Customs duty FX rate by 14%

The Central Bank of Nigeria (CBN) has increased the Customs duty forex rate by 14 per cent.

The former rate of N1,164.84/$ previously used for the opening Form M has been increased by N162.51.

This means that importers opening Form M this week to clear goods at the port will require more money to pay import duties than those who opened Form M at the weekend.

According to a report by BusinessDay, the naira had its worst run since the devaluation in January, falling 7.8 percent to N1,339.23 on Friday from N1,234.49 at the beginning of the week, according to data by FMDQ Securities Exchange.

The naira appreciated to N1,280/$ Saturday, an 8.57 percent gain compared to N1,400/$ Friday, according to multiple traders who spoke with BusinessDay.

In his reaction, Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, told BusinessDay that Nigeria needs to deemphasise revenue generation because too much emphasis on revenue causes growth, job creation, and development to suffer.

He said fiscal authorities need to stabilise rates to give policy support to critical sectors of the economy and also give breathing space to investors without burdening them with too much taxation.

Eugene Nweke, a freight forwarder, called for a fixed exchange rate regime for cargo clearing at the port to give relief to businesses, support trading activities, and stabilise the market value of products.

According to him, the port’s high import and clearing cost is exacerbating Nigeria’s inflation rate.