Data Story | By Hussaini Umar
Nigeria approved an estimated ₦34 trillion worth of Import Duty Exemption Certificates (IDECs) in 2025, with nearly 60 percent allocated to military imports, highlighting the growing fiscal cost of security spending as the Nigeria Customs Service (NCS) strives to meet its ambitious ₦11.04 trillion revenue target for 2026.
Data presented by the Comptroller-General of the Nigeria Customs Service, Bashir Adewale Adeniyi, before the Senate Committee on Finance show the difficult balance between raising government revenue and implementing fiscal incentives designed to address national priorities such as insecurity, industrialisation, healthcare and energy transition.
At a Glance
| Indicator | Value |
|---|---|
| Total Import Duty Exemptions Approved (2025) | ₦34 trillion |
| Military-related exemptions | ≈60% (₦20.4 trillion) |
| Other exemptions | ≈40% (₦13.6 trillion) |
| Customs Revenue Generated (Jan–June 2026) | ₦4.5 trillion |
| 2026 Revenue Target | ₦11.04 trillion |
| Revenue Yet to be Generated | ≈₦6.54 trillion |
Where Did the Duty Waivers Go?
Based on Customs figures, approximately ₦20.4 trillion worth of exemptions were granted for importing military hardware, reflecting the Federal Government’s continued investment in addressing insurgency, banditry and other security threats.
The remaining ₦13.6 trillion covered strategic sectors, including:
- Compressed Natural Gas (CNG) equipment
- Electric and hybrid vehicles
- Medical equipment and healthcare supplies
- Industrial machinery
- Manufacturing inputs
- Food import intervention programmes
Estimated Distribution of Duty Waivers
Military Equipment ████████████████████ 60%
Economic & Social Sectors █████████████ 40%
Data Insight 1: Security Is Now Nigeria’s Largest Customs Tax Incentive
The figures suggest that security has become Nigeria’s biggest recipient of import tax incentives.
With roughly ₦20.4 trillion in exemptions dedicated to defence equipment alone, military procurement accounted for more than half of all approved waivers.
This illustrates how fiscal policy is increasingly being used as a national security instrument rather than merely an economic tool.
Data Insight 2: Customs Has Collected Only 41% of Its Annual Target
As of 30 June 2026, Customs reported generating:
₦4.5 trillion
Against a target of:
₦11.04 trillion
Revenue Performance
Target Achieved
Collected ████████░░░░░░░░░░░░ 41%
Remaining ████████████░░░░░░ 59%
To meet its annual goal, Customs must collect approximately ₦6.54 trillion during the second half of the year.
This would require monthly collections significantly higher than the first-half average.
Data Insight 3: Duty Waivers Exceed Annual Revenue Target by More Than Three Times
Another striking finding is the scale of exemptions relative to projected revenue.
| Comparison | Amount |
|---|---|
| Duty Waivers (2025) | ₦34 trillion |
| Customs 2026 Revenue Target | ₦11.04 trillion |
The value of approved exemptions is more than three times Customs’ annual revenue target.
This comparison does not imply that Customs “lost” ₦34 trillion in collectible revenue because exemption values represent the value of imports approved under the scheme, not necessarily the exact duties forgone. However, it illustrates the enormous fiscal footprint of Nigeria’s exemption policy.
Why Customs Says Waivers Matter Beyond Revenue
Comptroller-General Adeniyi argued that fiscal incentives should not be evaluated solely by the amount of revenue forgone.
According to him, exemptions are intended to achieve broader national objectives, including:
- improving security,
- reducing transportation costs through CNG adoption,
- encouraging industrial production,
- improving healthcare delivery,
- stabilising food prices.
The effectiveness of these policies therefore depends on whether they actually produce measurable economic benefits.
Call for Better Monitoring
Customs is advocating stronger monitoring systems to determine whether companies and institutions benefiting from duty waivers are delivering promised outcomes.
Suggested performance indicators include:
- reductions in consumer prices,
- increased local manufacturing,
- improved healthcare access,
- economic expansion,
- employment generation.
Without such monitoring, policymakers may struggle to determine whether the tax incentives deliver value commensurate with their fiscal cost.
Another Fiscal Concern: Unremitted Government Funds
The Senate hearing also highlighted disputes over government remittances.
According to the Fiscal Responsibility Commission (FRC):
| Agency | Alleged Outstanding Operating Surplus |
|---|---|
| Nigeria Customs Service | ₦8.9 billion (as of 2019) |
| Corporate Affairs Commission | ₦13.9 billion (2023–2025) |
Customs rejected the allegation, while the Corporate Affairs Commission acknowledged ongoing efforts to reconcile and settle its obligations.
The Senate Committee directed all parties to reconcile their financial records and submit a report within two weeks.
The Bigger Picture
Nigeria increasingly relies on tax incentives as instruments of economic and security policy.
However, the ₦34 trillion exemption programme raises important public policy questions:
- How much additional investment has the programme generated?
- Have food import waivers reduced inflation?
- Have industrial exemptions increased domestic manufacturing?
- Are CNG incentives accelerating Nigeria’s energy transition?
- Has military spending translated into measurable security improvements?
These are the questions that future public expenditure monitoring and open government data will need to answer.
Data Sources
- Senate Committee on Finance investigative session (July 2026)
- Nigeria Customs Service (NCS)
- Fiscal Responsibility Commission (FRC)
