The Nigeria Customs Service (NCS) is to begin collection of 7.5 per cent Value Added Tax (VAT) on import of Automotive Gas Oil (AGO), otherwise known as Diesel.
This was contained in a notice served to the product importers and suppliers.
The notice, which is at the instance of the Federal Inland Revenue Service (FIRS), is expected to take effect from July 2023.
Diesel suppliers who have been importing the product without paying VAT for years.
In the notice signed by the Assistant Comptroller-General of Customs in charge of Tariff and Trade, MBA Musa, on behalf of the Deputy Comptroller-General of Customs in charge of Tariff and Trade, the VAT Modification Order 2021 only exempts petroleum products of HS codes 2709.00.00.00 – 2710.19.12.00.
AGO, or diesel, falls under HS Code 2710.19.21.00 and is not exempted from paying VAT.
The memo, therefore, enjoined all future importers of the product to assess and pay VAT at the point of entry into the country, adding that AGO, or diesel, is not exempted from destination inspection or import guidelines and as such is expected to process Form M and PAAR as well as make declarations appropriately in the NICIS II system.
It further stated that the decision to charge VAT for diesel importations was stated to be in compliance with the VAT Modification Order 2021.
