CBN asks commodities marketers to comply with 2012 fiscal policy guidelines

The Central Bank of Nigeria (CBN) Tuesday asked commodity marketers to abide by the fiscal policy guidelines on importation of some commodities in line with the fiscal thrust of the 2012 Appropriation Bill.

The apex bank said though the marketers are expected to enjoy concessionary tariffs in the 2012 financial year, all authorised dealers must ensure strict compliance with the approved regime.

In the guidelines signed by the bank’s Director of Trade and Exchange Department, Batari Musa, addressed specifically to authorised dealers, the apex bank stated that with effect from January 31, 2012, agricultural machinery and equipment shall attract zero per cent duty in order to support  the development of the agricultural sector.

The guidelines also said that equipment and machinery in the power sector shall attract zero per cent duty, to create a robust power sector and provide an enabling environment for investment.

In addition, the apex bank stated further that with effect from March 31, importation of cassava flour shall be prohibited, to encourage the substitution of high quality cassava flour for wheat flour bread- making and that corporate tax incentive rebate of 12 per cent shall be enjoyed by bakers on attainment of 40 per cent cassava blend within a period of 18 months. It also disclosed that “all equipment for processing cassava flour for composite flour blending shall be imported duty free.

“In order to encourage the purchase and utilisation of locally produced commodities, the under-listed measures are hereby introduced with effect from 1st July, 2012: wheat flour shall attract a levy of 65 per cent and 35 per cent duty rate; wheat grain shall attract a levy of 15 per cent and 5 per cent duty; husked brown rice shall attract a levy of 25 per cent and duty rate of 5 per cent; imported polished rice shall attract a levy of 40 per cent and duty of 10 per cent”, CBN added.

On  concessions, the bank pointed out that in order to expand domestic production, boost exports, generate employment and create a level playing field, concessions and waivers shall be granted only on sectoral basis, adding that all dealers should bring the attention of their customers to the measures for strict compliance.

President Goodluck Jonathan had highlighted in his 2012 Appropriation Bill speech to the joint session of the National Assembly on December 13, 2011 these measures as strategic to the Transformation Agenda, especially as regards the development of the agricultural sector and creating jobs in the economy.

 “This Administration has adopted enabling measures to support the development of private sector-driven marketing institutions, and push for policies that would promote our agriculture to create jobs,” he said. “To unleash the potential of this sector, the Federal Ministry of Finance has put in place a mechanism to share risks with the banking sector by guaranteeing 70 per cent of the principal of all loans made for supply of seeds and fertilizer by the private sector this season.

“In addition, to get the inputs to farmers at an affordable cost, we are subsidizing the interest rate on these loans to bring it down from 15 per cent to 7 per cent per annum. The Minister of Agriculture and the Central Bank are collaborating to extend these services for credit availability for the medium term.

 “We are introducing further fiscal policy measures to support the development of the agricultural sector. In this respect, the duty on machinery and certain specified equipment for the sector will, effective January 31st 2012, attract zero duty. We will further look at supportive fiscal policies for the rice and wheat sectors to stimulate domestic production”, the President said.