Home » Stakeholders Query Customs’ Delay in Implementing VAT Exemption on LPG Imports

Stakeholders Query Customs’ Delay in Implementing VAT Exemption on LPG Imports

by Editor

By Odun Edward,

MORE than one week after the Federal Government of President Bola Ahmed Tinubu had ordered the exemption of Liquefied Petroleum Gas (LPG) imports from Value Added Tax (VAT) the stakeholders in the industry are asking the Comptroller-General of the Nigeria Customs Service Adewale Adeniyi to explain the rationale for the alleged lethargic implementation of the directive.

Rising yesterday from an emergency meeting of the LPG Stakeholders Freight in Abuja, the Chairman, Alhaji Kabir Babawale said Adeniyi should explain to Nigerians the reasons behind his alleged refusal to comply with the directive of the Presidency.

He noted that the LPG storage tanks of many of his members under the code of 73111.00.00.00 are lying helpless at the ports with increasing demurrage on daily basis, adding, “will the Customs pay for the demurrage now that it has refused to obey the directive of the Presidency? We are anxiously awaiting the implementation of this directive.”

Babawale, while thanking the Presidency for its proactive decision on the exemption order believed that the development would boost the Gas Economic Policy of the government and ease off the excruciating costs of domestic cooking gas in the country.

He noted, “as investors, we are ready to commit more into the business, but before then, we are anxiously awaiting the implementation of this directive. Or Can we begin to insinuate that there is a parallel body to the Federal Government in Nigeria?”

Recall that in a move aimed at making cooking gas more affordable for Nigerians, the Federal Government had few days ago announced the exemption of the LPG imports from VAT and customs duty.

This decision, communicated through a letter from the Ministry of Finance, is expected to significantly reduce the cost of cooking gas for households and businesses across the country.

The Federal Government had decided to waive customs duty and VAT on importing the commodity and its accessories to crash the price of the LPG nationwide.

The report said the Ministry of Finance conveyed the decision in a letter dated November 28, 2023, and addressed to several officials, including the Special Adviser to the President on Energy, the Comptroller General of Customs, and the Chairman of the Federal Inland Revenue Service (FIRS). The Minister of Finance, Wale Edun, signed the letter.

The letter partly reads: “In line with His Excellency, President Bola Tinubu’s commitment to improving the investment climate in Nigeria, increasing the supply of LPG to meet local demand, reducing market prices, and promoting clean cooking practices, I hereby affirm Presidential directive dated July 29, 2022, with reference number PRES/88/MPR/99,” the letter reads.

The letter also directed Nigeria Customs to comply with the presidential directive of July 29, 2023, and withdraw all debit notes issued to oil marketers who have imported the product, using codes 2711.1.200.00 and ‪2722.13.00.00‬ from August 26, 2019, to the present.

Other items exempted from VAT and duty payment are LPG cylinders, cascades, gas leak detectors, steel pipes, valves and fittings, dispensers, gas generators, and trucks.

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