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Taming Inflation: Tinubu To Suspend Import Duty On Foods, Drugs For Six Months

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President Bola Tinubu may suspended the payment of import duties and tariffs on essential commodities for a period of six months, via an executive order.

This decision is outlined in an executive order titled “Inflation Reduction And Price Stability (fiscal policy measures, etc.) Order, 2024.”

The order seeks to provide relief to Nigerians grappling with soaring prices and inflationary pressures, particularly on staple food items, drugs, and basic commodities.

According to anunsigned copy of the order obtained by Meteor on Wednesday, President Tinubu intends to authorize rice millers to import paddy rice at zero duty and Value Added Tax (VAT) for the specified duration.

The suspension of import duties and tariffs aims to stimulate local supply chains and bolster capacity utilization among rice millers.

The executive order specifies a range of measures aimed at easing the financial strain on citizens and boosting economic stability.

The order reads, “Governments at all levels and their agencies shall patronise MADE IN NIGERIA goods and services to the extent possible.

“Payments of taxes and levies in foreign currency shall be discontinued to enable the payers pay in Naira while non-critical spending plans by any MDA involving foreign exchange cost shall be put on hold.”

It suspends import duties on staple food items, raw materials for manufacturing, agricultural inputs, pharmaceutical products, and poultry feeds, among others, for the designated six-month period.

Furthermore, VAT is suspended on various items for the entirety of the year 2024, including basic food items, semi-processed staple food items, raw material inputs for food manufacturing, electricity, public transportation, agricultural inputs, produce, and pharmaceutical products.

In addition to these fiscal measures, the order grants a rebate on import duty by fixing the exchange rate at eight hundred Naira to one United States Dollar (US$1) for the same six-month period.

This measure aims to reduce the cost of importing goods and ease inflationary pressures on consumer prices.

The executive order also emphasizes the government’s commitment to prioritizing capital expenditures on essential infrastructure projects aimed at enhancing productivity and improving citizens’ livelihoods.

These include access roads to farms, solar-powered food storage facilities, irrigation systems for dry season farming, portable water supply, and public sanitation facilities.

To finance these infrastructure projects, the order stipulates that a minimum of fifty percent of the incremental revenue accruing to the Federal Capital Territory (FCT) from the removal of Petroleum Motor Spirit (PMS) subsidy and Naira flotation shall be earmarked for this purpose.

The order encourages states and local government councils to adopt similar measures to prioritise infrastructure development.

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