The federal government has initiated moves to end the hike in prices of Liquefied Petroleum Gas (LPG) by exempting the product and its equipment from the payment of customs duty and value-added tax (VAT).
This was disclosed in a letter signed by the minister of finance and the coordinating minister of the economy, Wale Edun and addressed to the special adviser to the president on energy; the comptroller-general of the Nigeria Customs Service (NCS); and the chairman of the Federal Inland Revenue Service (FIRS).
Apart from LPG, the FG has also directed that other items like LPG cylinders, LPG cascades, gas leak detectors, steel pipes, steel valves and fittings, LPG dispensers, gas generators, and LPG trucks, among others be exempted from VAT and duty payment.
Following a rise in the price of LPG per kg from about ₦700 to above ₦1,100 in some parts of the country, the Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo during a stakeholders meeting last month, relayed the concerns of the President as regards the skyrocketing increase in the price of cooking gas and the attendant hardship on the majority of citizens.
A committee was later set up by the minister to come up with recommendations on how to crash LPG prices.
Part of the letter read: “In line with His Excellency, President Bola Tinubu’s commitment to improving the investment climate in Nigeria, increasing the supply of LPG to meet local demand, reducing market prices and promoting clean cooking practices, I hereby affirm Presidential directive dated July 29, 2022, with reference number PRES/88/MPR/99,”
“Accordingly, the importation of LPG utilising HS Codes 2711.12.00.00, 2711.13.00.00 and 2711.19.00.00 is exempt from Import Duty and Value-Added Tax. Consequently, the Importation of LPG shall incur a 0% duty rate and 0% VAT rate, effective immediately.”
The Nigerian Customs Service (NCS) and Federal Inland Revenue Service (FIRS) have been instructed to comply with the directive pending its official gazetting.
Also, the NCS has been directed to withdraw all debit notes earlier issued to petroleum marketers who have imported LPG using specific codes from August 26, 2019, to date.