Nigeria grants tax waiver on meter imports, ending estimated billing
Nigeria took a major step to ensure that electricity consumers are rescued from the tyranny of estimated billing by power distributions companies as President Muhammadu Buhari approved a one-year deferment of the 35 percent Import Adjustment Tax (IAT) imposed on meters. The gesture is to make electricity meters affordable for consumers.
Zainab Ahmed, minister of finance and budget who disclosed this on Wednesday said the request for the approval was made to support the Nigerian Electricity Regulatory Commission (NERC) in rolling three million electricity meters, which is under the Meter Asset Provider (MAP) framework.
According to her, the 35 percent levy, which was approved in 2015 on the importation of FBU electricity meters, attracted 10 percent import duty rate under the ECOWAS CET.
importers of electricity meters got a reprieve yesterday as President Muhammadu Buhari approved a one-year deferment of the 35 percent Import Adjustment Tax (IAT) imposed on Fully Built Unit (FBU) HS Code 9028.30.00.00 meters.
Finance and National Planning Minister Mrs. Zainab Ahmed had the 35 percent levy, which was approved in 2015 on the importation of FBU electricity meters, attracted 10 percent import duty rate under the ECOWAS CET.
“The 35 percent levy was imposed on the recommendation of the Federal Ministry of Industry, Trade and Investment, to encourage local production, as well as protect investments in the local assembly of electricity meters.
“An important feature of the MAP regulation is a gradual up scaling of the patronage of local manufacturers of electricity meters with an initial minimum local content of 30 percent with the potential of significant job creation in the area of meter assembly, installation and maintenance.”
“The application of the 35 percent levy on electricity meters – HS Code 9028.30.00.00 has created a significant challenge to the smooth implementation of MAP scheme of NERC,” the minister said.
Though the 35 percent levy has been in existence since 2015, the MAP regulations by National Electricity Regulatory Commission (NERC) in 2018 to bridge the electricity metering gap, it did not factor in the 35 percent levy in arriving at the regulated cost of electricity meters to end-users (consumers).