Petrol Import Rebate May Cost Nigeria Over $561.2Mn, N334.2Mn

 In Investor News

Nigeria is to lose $561.2Million, as well as N334.2Million in revenue due to indiscriminate approval of 50 per cent rebate approved by Federal Government on imported petrol this year, it was learnt yesterday, 21st of June 2018.

The rebate has not yielded the desired result of bringing down the N145 per litre price of petrol, the Managing Director, Nigerian Ports Authority (NPA), Ms. Hadiza Usman told a House of Representatives panel. Ms. Usman, who appeared before the Patrick Asadu-led Committee on Ports and Harbours to defend and present the 2017 and 2018 budgets of NPA, sought a review of the rebate policy.

She said: “NPA lost $234.4Million and N3.2Billion between 2009 and 2015 as a result of 50 per cent reduction of charges on PMS vessels, while $561.2Million and N334.2Million would be lost in 2018.

“If you have done this before, why do you want to reintroduce it? She queried, saying, “if you reintroduce it, then let Nigerians know that the price of fuel will be reduced because Government has reduced NPA charges by 50 per cent. When you look at the Petroleum Product Pricing Regulatory Agency (PPPRA), template, you will see that NPA charges were reduced by half.”

The NPA Chief questioned the intention of the introduction of the rebate in the first place. “The NPA has been given directive to provide 50 per cent rebate on all PMS vessels that are coming into Nigeria. So we are concerned about that 50 per cent rebate because it was instituted and suspended in June 2015. While it was on (2011-2015), there was no reduction in the price per litre of PMS,” querying who enjoyed that rebate.

Ms. Usman said: “While the rebate was on, the Federal Government lost 50 per cent of the value of the revenue that will be paid for vessels coming into the ports. We questioned that and we need to have clarity on that. “Now that it’s been reintroduced, we need to see that recognition within the PPPRA templates, within the price for a litre of fuel.

“We need to see that Nigerians appreciate and recognise the value of the rebate. We cannot keep on giving a rebate without it being reflected in price of petrol; we are concerned about that,” she said. Ms. Usman however said a review of the policy is imperative if Nigerians must benefit from the policy with a downward review of the price of petrol.

She said: “We have also been given a directive to collect payments in Naira as opposed to payments in Dollars, the marine industry payment is denominated in Dollars and so even if Nigeria collects the revenue in Naira, Nigerians will not benefit from it because the shipping trade is done in Dollars.” The President gave an approval for us to implement the payments in Naira, saying the NPA has discussed with the Central Bank of Nigeria (CBN) Governor and the Minister of Petroleum Resources and they all recognised that this can be done.

https://www.financialwatchngr.com/2018/06/22/petrol-import-rebate-may-cost-nigeria-over-561-2m-n334-2m/

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