Nigerians may soon face higher prices for everyday goods as the Federal Government reintroduces a 4% Free-on-Board (FOB) charge on imports, a move that has drawn sharp criticism from the Manufacturers Association of Nigeria (MAN).

The levy, which took effect on August 4, 2025, replaces two existing charges: the 1% Comprehensive Import Supervision Scheme (CISS) fee and the 7% cost of collection by the Nigeria Customs Service (NCS). According to the Comptroller-General of Customs, Adewale Adeniyi, the new framework is designed to simplify the system and consolidate revenue collection.

But for manufacturers and ordinary Nigerians, the implications may be far more complex.

Why Manufacturers Are Concerned

In a statement signed by its Director-General, Segun Ajayi-Kadir, MAN warned that the policy will further squeeze manufacturers already battling tough economic conditions.

• Rising Costs of Production: Import-dependent manufacturers rely heavily on raw materials not locally available. MAN estimates that Nigeria spent over ₦6.6 trillion on imported inputs in 2024. Adding a 4% FOB levy will inflate costs further, pushing businesses to pass the burden onto consumers.
• Fueling Inflation: With inflation already at 21.88% in July 2025, the group fears the levy will intensify upward price pressures. “Clearly, this will exacerbate the prevailing struggle with high inflation,” MAN stated.
• Weak Competitiveness: Neighboring economies such as Ghana, Côte d’Ivoire, and Senegal apply fees in the range of 0.5%–1%, and often reserve higher charges for luxury imports. Nigeria’s blanket 4% levy could divert cargo to regional ports, encourage smuggling, and worsen informal trade.
• Operational Strain: Manufacturers also cited persistent glitches on the NCS B’Odogwu platform, which have caused clearance delays, demurrage costs, and factory stock-outs. The new levy, they argue, adds another layer of uncertainty.

What It Means for Ordinary Nigerians

The average consumer is likely to feel the impact in three key ways:

1. Higher Prices: Imported raw materials and goods will become more expensive, feeding into the prices of finished products such as food, household items, and pharmaceuticals.
2. Inflationary Pressures: With manufacturers already spending heavily on energy (over ₦1.1 trillion annually) and facing interest rates above 35%, the levy could accelerate inflation, eroding household purchasing power.
3. Reduced Choices: Cargo diversion to ports in neighboring countries may disrupt supply chains, leading to scarcity or reduced availability of certain goods.

Government’s Position

The Nigeria Customs Service insists the new regime simplifies the import process. Comptroller-General Adeniyi explained that under the 4% FOB framework, importers will only pay one consolidated charge upfront, with no additional levies applied.

Supporters of the policy argue that consolidation will reduce bureaucratic bottlenecks, enhance transparency, and boost government revenue.

What MAN Wants

MAN has urged the Federal Government to:

• Suspend the 4% levy until December 31, 2025 to allow for impact assessment and consultations.
• Retain the current 1% CISS + 7% collection fee structure in the interim.
• Engage stakeholders before final implementation to ensure industrial competitiveness is not undermined.

“The Nigerian manufacturing sector is struggling and shrinking,” the association warned. “Introducing an additional blanket levy at this time is not only anti-industry but also runs contrary to the government’s industrialization and diversification agenda.”

The Bigger Picture

The debate over the 4% FOB charge highlights the delicate balance Nigeria must strike between raising government revenue and sustaining industrial growth.

For now, the policy promises more money for the state, but unless carefully managed, it risks deepening inflationary pressures and worsening the cost-of-living crisis for millions of Nigerians.