LCCI Calls for Immediate Suspension of 4% FOB Levy, Citing Business Disruptions

The Lagos Chamber of Commerce and Industry (LCCI) has urged the federal government and the Nigeria Customs Service (NCS) to suspend the implementation of the newly introduced 4 per cent free-on-board (FOB) levy on imports.

The NCS announced the levy’s implementation on Wednesday, triggering widespread concern among businesses. LCCI Director-General Chinyere Almona issued a statement expressing deep reservations about the abrupt enforcement of the charge, emphasizing that businesses were not given sufficient notice or time to prepare for the additional financial burden.

Almona criticized the lack of stakeholder consultation, arguing that the move contradicts international best practices, which emphasize transparency and inclusivity in trade-related policy changes.

Almona warned that the sudden imposition of the levy could stall shipments, disrupt trade flows, and worsen existing economic challenges.

“While we recognize that the 4% charge is backed by the provisions of the Nigeria Customs Service Act 2023, specifically under Section 18, we are deeply troubled by the manner of its sudden implementation without consultations with relevant stakeholders,” she said.

She further pointed out that Section 23 of the same Act mandates public notification and engagement before introducing new charges. However, importers, exporters, freight forwarders, and clearing agents were caught off guard by the decision.

Beyond the lack of consultation, Almona stressed that businesses are already struggling with multiple financial pressures, including rising taxes, high interest rates, inflation-driven operational costs, and forex scarcity for importing critical production inputs.

“Most recently, the business community has been grappling with a planned 50% hike in telecom tariffs and escalating logistics costs due to high energy prices. The sudden introduction of this levy further complicates an already difficult business environment,” she added.

The LCCI warned that the unexpected implementation of the 4% levy could deter trade activities, increase transaction expenses, and create instability in Nigeria’s trading sector—factors that could ultimately lead to lower government revenue.

Almona pointed out that despite surpassing its 2024 revenue target by over a trillion Naira—achieving N6.1 trillion—Nigeria Customs Service’s approach to revenue generation should not come at the cost of business viability.

“With massive revenue generated from the ports, we expect more investment in port infrastructure, process automation, and a conducive business environment to support export earnings and boost our foreign exchange reserves,” she said. “Uncertainties and controversies are toxic to our business climate and must be avoided at all costs.”

Almona called on the government to shift its focus toward improving port efficiency, easing trade facilitation, and curbing corruption in the system. She reiterated the chamber’s demand for an immediate suspension of the levy and urged authorities to prioritize economic growth alongside revenue collection.