CUSTOMER NOTICE: 7.5% VAT ON SERVICES AND IMPORT COSTS
Valuehandlers – VAT & Customs Cost Compliance Notice
Effective Date: 1 February 2020
Valuehandlers wishes to formally notify our customers, business partners, and other stakeholders that, in compliance with applicable Nigerian tax legislation, we apply the statutory 7.5% Value Added Tax (VAT) to taxable services rendered by the company.
The VAT rate was increased from the former 5% to 7.5% with effect from 1 February 2020.
As a professional logistics and supply chain management company committed to transparency, regulatory compliance, and responsible business practices, Valuehandlers considers it important that our customers understand how this tax affects both our service invoices and, where applicable, the overall cost of importing goods into Nigeria.
7.5% VAT on Valuehandlers Services
Effective 1 February 2020, applicable taxable services provided by Valuehandlers International are subject to 7.5% VAT in accordance with Nigerian tax regulations.
This means that VAT may be added to applicable Valuehandlers service charges as required by law.
The introduction of the 7.5% rate represents an increase from the previous 5% VAT rate.
Valuehandlers does not treat this statutory tax as an additional company service charge. It is a government tax collected and accounted for in accordance with applicable tax requirements.
Our responsibility is to ensure that the appropriate tax is transparently reflected on applicable invoices.
7.5% VAT and the Calculation of Import Costs
Importers should also understand an important distinction:
VAT is not the same as Customs Duty.
When goods are imported into Nigeria, the applicable Customs Duty is determined primarily by the tariff classification and other applicable customs rules. VAT is a separate tax component that may also apply to taxable imported goods.
The Nigeria Customs Service’s current import procedures identify 7.5% VAT for applicable imported products, although the VAT treatment can vary depending on whether a product is exempt or subject to a specific statutory treatment.
Import VAT is therefore one of the variables that importers need to consider when estimating their total import cost or landed cost.
What Determines the Total Cost of Importation?
An importer’s final financial obligation is not determined by the purchase price alone.
Depending on the nature of the transaction, the overall landed cost may include:
- Cost of the goods
- Freight charges
- Insurance, where applicable
- Customs valuation
- Customs Duty
- Applicable levies
- Import VAT
- Port and terminal charges
- Regulatory charges
- Customs processing and related costs
- Freight forwarding and clearing service charges
- Inland transportation
- Other applicable government or third-party charges
For import VAT purposes, the taxable value can include the customs value together with applicable customs duties, levies and certain other import-related charges.
Consequently, an importer should not simply calculate:
Purchase Price + Freight = Total Import Cost
A more accurate assessment requires consideration of the applicable customs and tax components.
Why Importers Should Understand VAT Before Shipping
One of the most common mistakes in international trade is calculating the cost of an import shipment without considering the full customs and tax implications.
For example, an importer may focus on:
“The supplier is selling this equipment for $20,000.”
But the actual landed cost may also be affected by:
- Freight
- Customs valuation
- Applicable import duty
- Import VAT
- Other applicable levies
- Port charges
- Clearing costs
- Local delivery
This is why Valuehandlers encourages customers to assess their Total Landed Cost before committing to international procurement.
Understanding the cost structure before shipment helps businesses make better purchasing decisions and reduces the risk of unexpected financial obligations when cargo arrives in Nigeria.
Customs Duty and VAT: Understand the Difference
For clarity:
Customs Duty
Customs Duty is determined according to the applicable tariff classification and customs regulations for the imported product.
Import VAT
Import VAT is a separate tax applicable to taxable imported goods and is currently 7.5%, subject to applicable exemptions and statutory treatment.
Therefore, an importer should not assume that a product attracting, for example, a particular Customs Duty rate automatically means that rate represents the complete tax obligation.
Customs Duty and VAT are separate components of the import cost calculation.
Valuehandlers’ Commitment to Transparency
At Valuehandlers International Limited, we recognize that logistics charges and government-imposed costs can significantly affect an importer’s final landed cost.
Our responsibility is therefore not simply to move cargo.
We also seek to help customers understand the cost and compliance implications associated with international shipping.
Where applicable, our customers receive clear information concerning:
- Freight charges
- Customs-related costs
- Government taxes
- Port and terminal charges
- Regulatory requirements
- Clearing and logistics service charges
- Inland delivery costs
We encourage importers to ask questions whenever they do not understand an item appearing on their quotation or invoice. Transparency creates trust.
An Important Reminder to Importers
Government taxes and statutory charges are subject to changes in legislation and applicable regulations.
The 7.5% VAT rate discussed in this notice should therefore not be interpreted as meaning that every imported product or transaction attracts exactly the same overall tax burden.
The applicable treatment depends on factors including:
- Nature of the goods
- HS classification
- Customs valuation
- Applicable exemptions
- Import regime
- Regulatory requirements
- Current government policies
For this reason, importers should obtain a shipment-specific assessment before making significant procurement or shipping commitments.
Our Position as a Responsible Logistics Company
Valuehandlers International Limited remains committed to operating within Nigeria’s applicable tax, customs, and regulatory framework.
We believe that responsible logistics companies should:
Comply with the law.
Explain costs clearly.
Protect customers from avoidable surprises.
Help businesses make informed supply chain decisions.
At the same time, we believe that taxes collected from businesses and citizens should contribute meaningfully to national development through improved infrastructure, public services, economic development, security, healthcare, education, and other public priorities.
Responsible taxation should be matched by responsible governance and accountable use of public resources.
Need Help Understanding Your Import Cost?
If you are planning to import goods into Nigeria, Valuehandlers can assist you in understanding the logistics and customs cost implications before your shipment moves.
Our services include:
- International Freight Forwarding
- Air Freight
- Ocean Freight
- Customs Clearing
- Import Documentation
- Customs Duty Advisory
- Cargo Consolidation
- Project Logistics
- Warehousing
- Inland Transportation
- Door-to-Door Logistics
Valuehandlers International Limited
Professional Freight Forwarding | Customs Clearing | Supply Chain Management
📞 Call: +234 803 224 1768
💬 WhatsApp: +234 808 237 5017
📧 Email: customercare@valuehandlers.com
Ship with knowledge. Understand your landed cost. Import with confidence.
