Calculation of Import Duty in Nigeria

Terminologies in Duty calculation:
FOB means Free on Board which is the actual cost of the imported items without putting the cost of the transportation or handling.

To use this figure in the calculation of Duty you must convert to Nigerian Naira i.e. FOB in the currency of export country exchange rate.

Freight is the cost of Transporting the imported items to the designated port of discharge whether by Sea, Air, or Road. This must also be converted to Naira i.e. Freight in the currency of export country’s exchange rate

CIF is Cost, Insurance, and Freight.In order to get your CIF, simply add the cost of the items imported, the insurance value (0.5% of FOB), and the cost of transportation, which is Freight.
VAT = 7.5% x (CIF + ID + Surcharge + CISS + ETLS). Where;

Surface Duty (ID): This is often commonly referred to as import duty. This is how the abbreviation (ID) came to terms. It is a duty based on the kind of item imported. The value depends on the HS Code – usually 5%, 10%, 20%, etc. of the CIF Value.ID = x% of CIF Value.
Import Duty is the tax collected on imported goods by customs.

Surcharge: is an additional tax levied on the importation of goods. It is meant for port development.Formula: 7% x Import Duty (ID).

CISS is an acronym for the ‘Comprehensive Import Supervision Scheme”Formula: 1% of FOB value.

ETLS is an acronym for ECOWAS Tax Liberalization Scheme, it is also referred to as ECOWAS levy. It is the tax imposed on goods that are imported from ECOWAS non-member countries into ECOWAS member countries.
In determining the Customs Duty Charge, the first step is to request for the HS Code.
This will help you to know the tax receivable by customs on importing the goods, otherwise referred to as Surface Duty.
So, (ID + Surcharge + CISS + ETLS + VAT = amount payable to customs)

Example