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Customs generated N720bn in 2016

Customs generated N720bn in 2016

ABUJA: The Comptroller-General of Customs, Col. Hameed Ali (retd), has said that the Nigeria Customs Service generated N720 billion in 2016. He made this known while defending the budget of the service before the Senate Committee on Customs, Excise and Tariff on Monday in Abuja. It was a subsidiary budget defence for Nigeria Customs Service as a revenue generating agency of government. Ali said that the approved revenue target for 2016 was N937 billion comprising of 862 billion for the federation and N75 billion for non-federation. He added that the service, however, collected total revenue of N720.7 billion or 77 per cent during the period. He stressed that the revenue collected was with a negative variance of N 216.6 billion or 23 per cent when compared with the target for the year.

The comptroller-general noted that the revenue performance of N720.7 billion in 2016 had a negative variance of N13.6 billion or 1.9 per cent when compared with N734 billion collected in 2015. ”During the period under review the service also collected the sum of N177.93 billion as VAT on imports thereby bringing the total collection to N898.67 billion. ”The shortfall in the performance is due to the fact that no revenue was collected on luxury items and polished rice levy because of lack of legal backing to enforce collection of luxury items and no importation of polished rice. ”Also responsible is restriction of 41items from accessing foreign exchange at official window as well as high exchange rate of Naira  against other foreign currencies increased the tax base of goods imported and reduced volume of trade.

”The scanners at the various Customs scanning sites are not functioning. This factor has adversely contributed to the services inability to carry out effective examination for selected consignments. ”Presently, only two commodities, cigarette and alcoholic beverages are under excise control and this did not help in the achievement of the N63.8 billion excise revenue target in the 2016 budget. ” The porous nature of the nation’s borders encourage smuggling activities and this constitutes some reasonable setbacks in the 2016 revenue collected,” he said. On budget expenditure for 2016, the comptroller-general said the  service had an approved budget expenditure of N81billion for 2016 financial year, out of which N53.5 billion or 66 per cent was received from federation and non-federation accounts.

He said of the amount, N35.60 billion representing 81 per cent was used for Personnel Cost, N4.98 billion, representing 11 per cent, for Overhead Cost and N3.35 billion for Capital Cost. He said there was an unutilised balance of N9. 6 billion representing 17.9 per cent, out of which N8.5 billion was intervention fund released to the service and dedicated to completion of its corporate headquarters. He added that the balance of N1.1 billion was cumulative savings meant to intervene when the seven per cent cost of collection could not meet up with payment of monthly personnel cost. On the 2017 budget proposal, Hameed said the service had a proposed expenditure of N80.6 billion, out of which N44 billion, representing 61 per cent was earmarked for personnel cost. Ali stressed that N12.5 billion or 17 per cent was budgeted for Overhead Cost while N15.6 billion, representing 21.6 per cent was budgeted for Capital Expenditure.

He said the service had mapped out strategies to improve revenue generation in 2017, including automation of auction procedure to ensure transparent assessment of revenue accruable from auction overtime cargo and seizures. “Some key features that may improve revenue generation in 2017 are proposed collaboration between the service, Federal Road Safety Corps (FRSC) and Federal Inland Revenue Service (FIRS) in relation to vehicle assessment and verification. “We are also looking at reviewing government extant policy on excise as well as strengthening border posts to expand our anti-smuggling strategy beyond the Customs approved routes. “Other strategies are capacity building for officers, provision of dry ports to accommodate imported vehicles, review of our evaluation database, intelligence unit, among others,” he said. In his remarks, the Chairman of the committee, Sen. Hope Uzodinma, commended the service for its effort in 2016 and urged it to put measures in place for improved performance in 2017. However, he urged the service to tidy up the defence documents by itemising the line items and submit to the secretariat of the committee.