The Nigeria Customs Service (NCS) has announced the removal of Value Added Tax (VAT) on Liquefied Petroleum Gas (LPG), commonly known as cooking gas, and Compressed Natural Gas (CNG). The agency also declared a zero per cent import duty on these products.
This update was shared by the NCS’ National Public Relations Officer, Mr. Abdullahi Maiwada, in a statement on December 18.
The statement explained: “In line with President Bola Ahmed Tinubu’s efforts to improve Nigeria’s investment environment and boost domestic gas use, the NCS introduces fiscal incentives under the Presidential Gas for Growth Initiative.”
“According to Part 1, Section 5 of the Customs and Excise Tariff Act, machinery, equipment, and spare parts for Nigerian gas use are now subject to a 0% import duty. This applies to all CNG and LPG-related equipment imported into the country.”
Additionally, several items now qualify for zero-rated VAT, including feed gas for processed gas, CNG, imported LPG, CNG and LPG equipment components, as well as conversion and installation services, and all infrastructure related to the expansion of CNG, LPG, and the Presidential CNG Initiative.
To benefit from these incentives, importers must obtain an Import Duty Exemption Certificate (IDEC) from the Federal Ministry of Finance and a letter of support from the Office of the Special Adviser to the President on Energy.
The statement also clarified that LPG imports under HS Codes 2711.12.00.00, 2711.13.00.00, and 2711.19.00.00 are exempt from both import duties and VAT. Therefore, the NCS will withdraw all debit notes issued to petroleum marketers who imported LPG under these codes from August 26, 2019, to the present.
