Nigeria To Cancel Tariffs, Excise Duties, VAT on Imported Pharmaceutical Inputs

Nigeria To Cancel Tariffs, Excise Duties, VAT on Imported Pharmaceutical Inputs. The Federal Government has initiated the cancellation of tariffs, excise duties and Value-Added Tax (VAT) on imported pharmaceutical inputs.

According to a statement by the coordinating Minister of Health and Social Welfare, Muhammad Ali Pate, President Bola Tinubu has signed an executive order to introduce zero tariffs, excise duties, and Value-Added Tax (VAT) on certain machinery, equipment, and raw materials imported for pharmaceutical production.

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As part of efforts to give new life to the Nigerian health sector, the President has signed an Executive Order intending to increase local production of healthcare products such as pharmaceuticals, diagnostics, and devices.

The Minister of Justice and Attorney General of the Federation, Prince Lateef Olasunkanmi Fagbemi SAN, upon whom it now rests to take the next steps towards codifying the new Order, noted the importance of the order.

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According to him, the order is critical to the success of the initiative for unlocking the healthcare value chain (PVAC_NG), which was approved back in October 2023 by the president.

The order introduces zero tariffs on certain items, including Active Pharmaceutical Ingredients (APIs), excipients, and other essential raw materials required to manufacture crucial health products to lower production costs and promote local manufacturers’ competitiveness.

Additionally, the order provides for launching market-shaping mechanisms such as framework contracts and volume guarantees, to motivate local manufacturers.

It also made compulsory collaboration among relevant ministries and agencies, including the Nigeria Customs Service (NCS), National Agency for Food and Drug Administration and Control (NAFDAC), Standard Organization of Nigeria (SON), and Federal Inland Revenue Service (FIRS), to enable quick execution and reduce regulatory bottlenecks.

According to the statement, the order provides market-based motivation to promote medical industrialization, lower costs of medical products through import substitution, create and keep economic value, and ensure the availability of employment in the healthcare value chain.

The waivers and exemptions will be valid for two years.


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