Government Suspends Controversial Import Levy After Backlash
Finance Minister halts 4% FOB charge after warnings it would spike inflation, raise freight costs by trillions, and damage manufacturers’ competitiveness.
Nigeria’s federal government has suspended the 4% Free-On-Board (FOB) levy on imports following widespread criticism from business groups and consumer advocates.
The suspension was announced by Finance Minister Wale Edun in a directive issued on September 15, 2025.
The levy, introduced earlier this year, was meant to boost revenue but quickly drew backlash for its potential to raise import costs, worsen inflation, and erode competitiveness for local industries.
The Manufacturers Association of Nigeria (MAN) warned that the levy would sharply increase production costs, undermine capacity utilisation, and hurt Nigeria’s industrial competitiveness. They argued that the new charge is unsustainable, especially when peer countries charge much smaller levies (0.5 – 1%) on similar imports.
Also, the Importers Association of Nigeria (IMAN) estimated that the 4% FOB levy would add N3-4 trillion annually to freight costs, which would then be passed on to consumers.
They also warned of disruptions in supply chains and negative effects on import-dependent sectors like machinery, pharmaceuticals, and raw materials.
In a statement, the Finance minister said the suspension would remain in place “pending further consultations with stakeholders to ensure fiscal measures do not stifle economic growth.”
Trade groups welcomed the decision but urged the government to focus on long-term policies that address Nigeria’s structural economic challenges rather than “short-term fixes that burden consumers.”
Source: All Africa
