On Senate Probe Of N30tr Revenue Loss

Nigerians are no strangers to the theatrics and grandstanding that often characterise probes by the National Assembly. When the men and women of the hallowed chambers are not scuffling with top government functionaries and heads of agencies and parastatals, they are going for the jugular of legitimate companies statutorily empowered to do their businesses in the country.

A case in point is the ongoing investigation of 63 companies by the Senate Joint Committee on Customs, Excise and Tariff and Marine Transport over an alleged N30 trillion revenue leakage in the import and export value chain. It is imperative to provide some insight on this to enhance understanding of the whole process of doing import and export business in Nigeria.

For starters, there are certain processes involved in the export and import business in Nigeria. One important document is the e-Form M. The e-Form M issued to import physical goods into the country. It is a mandatory documentation process put in place by the Federal Government through the Ministry of Finance and the Central Bank of Nigeria (CBN), to monitor goods that are imported into the country as well as enable collection of import duties where applicable.

Notably, some government agencies, departments and financial institutions are involved in the entire process, namely Nigeria Customs Service (NCS), the Industrial Inspectorate Department of the Federal Ministry of Industry, authorised commercial banks, the Central Bank of Nigeria, and the Trade and Exchange Department. There are specific procedures and timelines involved at every stage of the transaction.
However, the process is not ordinary, as gaps and glitches often exist between dealer companies and the various institutions involved in the business.

A Lagos-based expert in freight forwarding, Mr. Chibuike Ogbuanu attests to this: “Considering the several standard procedures to be undertaken before goods are successfully and lawfully shipped into the country, there is the need for a proper understanding of how things work around importation.”

Obviously, the lack of understanding of the intricacies of importation is responsible for the action of the Senate committee, particularly its hastiness in publicly condemning law-abiding companies on the pages of newspapers even without first giving them a fair hearing on the matter. Such misunderstanding on the part of the Senate is capable of bearing the consequence of false assumptions and accusations of violation by the affected companies in the export and import value chains. More so, considering the unenviable reputation Nigeria has in the global ‘Ease of Doing Business’ index, such glitches are inevitable. Even simple business processes are corruptly and deliberately made tedious and drawn out especially by service providers in government institutions. Thus, lapses often occur in freightage, making it a harrowing experience for most companies involved in the business.

For this reason, the joint committee should have first endeavoured to acquaint itself with the processes involved in these transactions.

The best approach should be to find proactive ways of addressing these gaps rather than demonising the companies involved and making grave allegations capable of damaging their reputations and business operations in Nigeria.

Even if the Senate has any point to prove, subjecting legitimate companies to public ridicule has the unfortunate consequence of damaging their hard-earned reputation. This certainly does not help the security and confidence of established investors in the country and many others eyeing the Nigerian economy especially as the Nigerian government has been trying to woo investors into the country.

What baffled most observers and other interested parties, according to people privy to the discussions, was that there was no clear accusation levelled against the companies fingered in these allegations. Chairman, Senate Committee on Customs Excise and Tariff and Marine Transport, Senator Hope Uzodinma, who spoke to reporters after the meeting, refused to name the companies that he allegedly admitted connivance with cabals in the Customs Service to defraud the Nigerian government.

The implication, therefore, was that the innocent companies among the lot that appeared before the Senate committee have inadvertently been painted in a bad light one way or the other. Already, the facts of the meetings with the CEOs have been misrepresented in the public space as some media organizations have tarred all the companies that visited the Senate committee with the same brush of infamy in the manner that they reported Uzodinma’s allegations.

Having the probe broadcast on TV would have helped to ensure transparency and prevent the collateral damage in the allegations.

A damning contradiction about the allegations raised by the Senate joint committee is the fact that some of the companies being vilified were recently acknowledged and lauded for regularly paying their excise duties and contributing hugely to government’s revenue. This could be deciphered from reportage attributed to the Comptroller General of Customs when he undertook a working visit to all excise companies in the country last year.

The Senate’s unnecessary malignancy will undo efforts made so far to create a stable and conducive environment for businesses to thrive. This presents a strong imperative to the acting President, Ministers of Industry and Trade and Finance to step in and save the legitimate companies doing their businesses in Nigeria from being stifled out of business. Well-meaning Nigerians must also speak up against the reckless use of power by the legislators to disturb law-abiding firms in the country. Companies must not be used as pawns in fighting proxy wars with the Federal Government and national institutions.

The Nigerian economy is currently too fragile to be further squeezed by needless issues capable of scaring foreign investors away.

 

Source: The Guardian