The Federal Inland Revenue Service (FIRS) has informed diesel suppliers in Nigeria that they are required to pay value-added tax (VAT) on automobile gas oil (AGO) or diesel imported into the country.

A letter forwarded by MBA Musa, the Assistant Comptroller-General of Tariff and Trade of Customs to this effect, on behalf of the Deputy Comptroller-General of Tariff and Trade to diesel suppliers, dated June 8th, 2023, and addressed to diesel suppliers, cited an FIRS letter dated 31st May 2023

According to the letter, the VAT Modification Order 2021 only exempts petroleum products of HS codes 2709.00.00.00 – 2710.19.12.00 from paying VAT. AGO or diesel falls under HS Code 2710.19.21.00 and is not exempted from paying VAT.

Therefore, all future importations of the product should assess and pay VAT at the point of entry into the country.

The letter also stated that AGO or diesel are not exempted from destination inspection or import guidelines and as such are expected to process Form M and PAAR as well as make declarations appropriately in the NICIS II system.

The decision to charge VAT for diesel importations is stated to be in compliance with the VAT Modification Order 2021.

“I am directed to forward a letter from Federal Inland Revenue Service on the above subject matter. The VAT Modification order 2021 only exempts Petroleum products of HS codes 2709.00.00.00 – 2710.19.12.00 from payment of VAT. AGO or Diesel falls classifiable under HS Code 2710.19.21.00 and is not exempted from paying VAT,” the letter reads.

“Subsequent upon the above, all future importations of the product should assess and pay VAT at the point of entry into the country.”

“Also note that AGO or Diesel are not exempted from destination inspection or import guidelines and as such are expected to process Form M and PAAR as well as make declarations appropriately in the NICIS II system