OpeOluwani Akintayo
Lagos — The federal government has imposed fresh tax bills on gas importation into the country, SweetcrudeReports has learnt.
According to findings, four major firms that import gas to supplement domestic supply, were issued a debit note by the Nigerian Customs Service, NCS.
Importers such as Matrix has been asked to pay about N11b, Providence N2.9b, NIPCO N4.9b, and Algasco about N9b.
These amounts, SweetcrudeReports learnt, were described as the cost of the tax on gas imported into the country between 2020 and 2021.
They were also issued debit notes for products imported since 2019.
As a result, the new taxes have been factored into the new gas rates to be bored by the masses even as the festive season approaches.
The taxes were introduced three months ago as the firms had enjoyed tax breaks as a way of encouraging Nigerians to use gas.
SweetcrudeReports recent market survey showed that a 12.5kg gas is already being sold for between N8500-N8700 depending on the location- an increase of over 100% from N3500 as at last December.
The federal government through its decade of gas initiative and the National Gas Expansion Programme, NGEP, had promised to make gas more accessible and affordable to the masses.
The Central Bank of Nigeria, CBN is sinking in about N250b intervention fund into the NGEP.
Nigeria still imports about 60 percent of Liquified Petroleum Gas, LPG for the domestic market, while 40 percent is being provided for by the Nigerian Liquified Natural Gas, NLNG Limited.
The affected firms, SweetcrudeReports learnt, have issued a joint memo to the Presidency to review the tax policy. They have also met with the NCS, and the minister of finance on the matter.
High cost of cooking gas has for the past few months, forced many households into cheaper alternatives such as kerosene, firewood and charcoal.
Experts have argued that even though imposing taxes to ensure local production would be a commendable effort, the country, however, lacks sufficient local capacity for gas production.
The Executive Director, International Support Network for Africa Development (ISNAD-Africa), Adedoyin Adeleke said
“My view is that while it is good that the government increases tax on the importation of gas, there should be complementary support to boost local production of gas. An increase in the tax on importation without increasing local production to crash the price will force many to return to cooking with firewood, which will negatively impact nature, biodiversity, and sustainable development in the country. The resulting environmental challenges will negatively impact the gains of socioeconomic development,” he said.
Renowned energy scholar, Wumi Iledare, said the decision to return taxes is coming at the wrong time. “However, if the levy is to discourage import, then it is a different matter entirely. I would rather discourage the government from additional tax at times like this in whatever form. It is as bad for the economy as subsidy payments,” he stated.
The Director at the Centre for Democracy and Development, CDD, Idayat Hassan, stated that already marginalised women would adversely be affected by the looming price, describing the move as at the height of insensitivity to the plight of Nigerians.
“It is sad that even though wages are not increasing, the government continues to increase the burden on Nigerians. We are expecting subsidy to be removed from petrol, and now we have to face another increase in the price of gas. This will badly affect the already distressed masses.
Nigerians are increasingly becoming much more vulnerable due to government policies that do not take cognisance of them, and this is aside from the insecurity that is making the country difficult to live in. It is increasingly becoming difficult to live as a Nigerian,” Hassan said.
According to her, the government may have to consider increasing workers salaries if it wants to continue with the prevailing policies.
