Cost of clearing in Nigeria is not the same across all goods. Many have called or sent enquiries to ask for clearance costs. However, our first response is usually in the form of questions. This is not like a proof that Nigerians often answer questions with questions. No, far from it. Firstly, we want to know what goods you are importing. Subsequently, the shipping method is of great importance to us.
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Furthermore, we are able to look up the tariff code for the goods and subsequently calculate the duty. With the duty known, other charges are determined according to container type or using dimensional information. Meanwhile, what we like to do in this article is present some recent clearance details for goods cleared. We believe that the knowledge from this sample should be a guide, not absolute information. Hence, we are making it clear that this article is for educational purpose only.
COST OF CLEARING IN NIGERIA; HOW TO DETERMINE IT
To illustrate, let us begin with the clearance of a hot melt adhesive in a 40-foot container. Thus, below is the goods description and cost details.
| NO | GOODS DESCRIPTION | PACK | QUANTITY | UNIT PRICE | TOTAL PRICE ($) |
| 1 | B.K.539 Beta melt hot melt 25KG BAG | bags | 300 | 44,400 | 13,320.00 |
| 2 | B.K.533 Beta melt hot melt 25KG KOVA | Bucket | 700 | 40,000 | 28,000.00 |
| Total EXW Istanbul factory | 41,320.00 | ||||
| Freight (USD) | 5,455.00 | ||||
| Total CFR (USD) | 46,775.00 | ||||
DATA TO CALCULATE CUSTOMS DUTY
From the simplified commercial invoice above, we can derive the following information to calculate Customs duty.
Total cost of goods (FOB) is $41,320.00, which is ₦16,890,376.4. Note that the naira equivalent is using approved exchange rate for importation of ₦408.77 to $1.
The freight from origin to Nigeria port (Apapa in this case) is $5,455.00, which gives ₦2,229,840.35.
Therefore, the marine insurance value is ₦21,032,238.43 (sum of cost and freight multiplied by 110%). Hence, marine insurance premium value is ₦17,877.40 i.e. insured value multiplied by insurance rate. In our case, insurance is clause C, with rate as 0.85%.
Consequently, total cost, insurance and freight (CIF) is ₦19,138,094.15.
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CUSTOMS DUTY
The goods in question is an adhesive or gum, and classified under HS Code 1301900000 for Other Lac excluding Gum Arabic. Thus, the goods have a surface duty rate of 5% without VAT.
Follow us as we calculate duty and applicable levies below.
CIF is ₦19,138,094.15
Surface duty (ID) is ₦956,904.71 (19,138,094.15*5%)
The surcharge, which is 7% of the surface duty, is (Sur) is ₦66,983.33
CISS, which stands for comprehensive Import Supervisory Scheme is 1% of the FOB, which is ₦168,903.76
ECOWAS levy or ECOWAS Tax Liberalizations Scheme is levy on goods into ECOWAS territory. ETLS is 0.5% of CIF, which is ₦95,690.47 (₦19,138,094.15*0.5%).
VAT, which is value added tax, is zero with HS Code of 1301900000 under consideration.
In summary, the total duty payable by this Importer is ₦1,288,482.27.
OTHER COST OF CLEARING IN NIGERIA
Besides the duties by federal government, there are other compulsory fees to shipping companies and terminals. Additionally, Clearing Agents or Customs Brokers charge for their services. Here is a breakdown estimates of what you pay in addition to Customs duty.
Firstly, the shipping company local charges (SLC) varies slightly from one shipping company to another. For 40ft container and estimate of ₦300,000 is excellent to make room for demurrage. Ordinarily, the SLC charge is ₦200,000 on average. The additional ₦100,000 is in case where there are delays, which are most likely to be so. So many factors contribute to delays in cargo clearance.
Secondly, the terminal handling charges are charges raised by the terminal or the warehouse where goods move to on arrival. Terminal charges include storage and equipment handling for loading and offloading. For a 40ft container, terminal charges estimated at ₦300,000. Like the shipping company charges, each terminal has charges slightly different from others. However, on average terminal charges is ₦200,000.
Read more about terminal charges; TERMINAL HANDLING CHARGES, SHIPPING COMPANY CHARGES
Thirdly, the Clearing Agency service charge for 40ft container is ₦200,000 mostly.
More so, there is the documentation costs. Documents required to clear this goods include SON PC/SONCAP, and possibly NAFDAC Import Permit (may not apply). Total documentation cost is ₦500,000.
ASSUMPTIONS TO STATED COST OF CLEARING IN NIGERIA
Let us state clearly that the calculation in this page is with some assumptions. Key of the assumptions in our calculation are as below:
- The Importer is using actual manufacturer’s invoice and accurate figures for goods value.
- Also, Nigeria Customs agree that the invoice value is correct, and acceptable.
- Again, no under declaration, nothing else, besides what is on paper is in the container.
- Similarly, the HS Code is acceptable by Customs as applicable to the goods in question.
- Furthermore, goods clearing is not more than seven to ten days after arrival.
Read also: HIRE CLEARING AGENT IN NIGERIA FOR SMART CLEARING
CONCLUSION
This article for cost of clearing in Nigeria is no theory work. The info in this article is from experiential point. Our main aim of writing this piece is to inform our potential clients, and in extension the public. Ordinarily, most cargo-handling professionals prefer to keep information like this away from the public. Vagmon e-Grup & Logistics is approaching cargo logistics from a different angle. We believe in dealing with informed client. Therefore, we delight in making our client understand the process through and through, and thus making the job easier for all. Finally, you can chat or call us on +2349075526276 for a seamless goods clearance. Equally, you can contact us via email and our physical office. Nevertheless, let me thank you for taking your time to read and understand the information loaded on this article.