Customs, FIRS, Finance Ministry Responsible for Skyrocketing Cooking Gas Price – Stakeholders




By Harry Awurumibe, Editor Abuja Bureau

With an average Nigerian family currently choking under the high cost of cooking gas, experts in the industry have laid the blame squarely on the door steps of three Federal Government agencies.

The trio of Federal Ministry of Finance, Nigerian Customs Service (NCS) and the Federal Inland Revenue Services (FIRS) have been blamed for the skyrocketing price of cooking gas following the their ill-advised decision to over tax gas marketers and retailers.

These disclosures were made on Friday on Channels Television breakfast programme Sunrise Daily by Mr. Dayo Adeshina, National Programme Manager, National Liquefied Petroleum Gas Expansion Implementation Plan and Mr. Nuhu Yakubu, President, Nigeria Liquefied Petroleum Gas Association.

Both strongly believe that the recent multiple taxation imposed on players in the gas industry especially the importers, marketers and retailers of cooking gas are responsible for the the high cost of the essential product in Nigeria.

Speaking on the topic: ‘Cooking Gas: Stemming the Rising Cost’, Adeshina said pointedly that the recent imposition of Value Added Tax (VAT) by FIRS and heavy Customs charges on cooking gas importers and retailers are responsible for the high cost of the product across Nigeria.

According to him: “price of cooking gas went up because Federal Government agencies are collecting backlogs of VAT from the Importers and to make the matter worse, the Importers are charged over N20 billion of backlogs of VAT and they are required to pay the huge amount within seven days by the mentioned government agencies. This has made them to pull back from further importation”.

Adeshina however said Nigeria needs over 2 million tons of gas in 2021 but the volume is not being met as gas consumption in Nigeria has moved from 700,000 to over 1.2 million in 2021, adding that NLPG under the Expansion Implementation Plan has converted 2 million homes to gas use.

He also revealed that NPLG Expansion Implementation Plan is working very hard to ensure that cooking gas market price is brought down.

He therefore gave steps to be taken to bring the price of cooking gas down to include making oil companies to deliver domestic gas locally and reduction of importation of cooking gas from abroad.

Also, speaking on the topic, Yakubu aligned himself with Adeshina on the causes of the high cost of cooking gas in Nigeria, saying that Federal Government policy inconsistencies are responsible for the current gas scarcity.

Said he: “Investing on gas infrastructure is quite heavy. Those who are in the business spend a lot of foreign exchange and the current dollar exchange rates have made the matter worse. Then government agencies like FIRS, Customs, etc now impose VAT and other levies on the Importers and retailers so this why the price of cooking gas in Nigeria have gone beyond the purchasing power of ordinary citizens of Nigeria”.

Explaining further Yakubu insists that NLNG cannot supply national needs because the gas company can only supply 400,000 tons while over 2 million tons are required to service Nigeria.

On how to bring the price of cooking gas down to save Nigerians the temptation of sourcing for alternatives to gas, the NLPGA President said FG should ensure the reduction of LPG Exportation.

“The Presidency and the Federal Ministry of Petroleum should reduce LPG Exportation and lower the barrier for entry into gas business. Also, reverse VAT on cooking gas and the product should be treated as an Essential Commodity”

“I make bold to say that FG should reverse VAT on cooking gas because if you add this VAT to the Import Levies by Customs and multiple Tax Collecting Agencies of Federal, States and Local governments as well as persons without any business with gas charging gas Vendors then price of cooking gas will not be affordable to Nigerians going forward”, Yakubu concluded.

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