SAD: Nigeria's Federal Govenment to Increase Tariffs on Imported Cars by 50 %
The
Federal Government has raised tariffs on imported cars and buses, with
the increase in tariffs on both new and used cars reaching 50 per cent.
The increase will take effect from January 2014.
Imported
fully built unit (FBU) cars, which total tariffs stood at 20 per cent
in the past, will now attract 35 per cent duty and 35 per cent levy,
totalling 70 per cent charges.
The
new policy was contained in a memo issued by the Coordinating Minister
for the Economy and Finance Minister, Dr. Ngozi Okonjo-Iweala, which was
sent to the Comptroller-General of Nigeria Customs Service (NCS), Dikko
Inde Abdullahi, in which the minister also stated that the duty on
buses had also been raised from 10 per cent to 35 per cent without levy.
FG
aims at cutting down importation of automobiles to encourage production
of cars and buses in the country. The government also hopes this would
create an environment to support existing assembly plants and attract
other Original Equipment Manufacturers who have expressed interest in
Nigeria
As
part of the policy, local auto manufacturers will no longer pay duties
or levies on their Completely Knocked Down (CKD) sets imported from
their overseas partners while Semi-Knocked Down (SKD) components for the
local production of vehicles shall attract only five per cent duty
without levy.
“We
welcome the initiative. It was long overdue. This is one policy that
will help the local industries discover themselves,” said Stallion
Motors spokesman, Mr. Manny Philipson, who spoke with LEADERSHIP
correspondent on the issue on November 21, 2013, Thursday.
With
the policy becoming effective in January next year, prices of imported
cars and buses are expected to rise astronomically as a result of the
increased import duty. Analysts predict as much as 250 per cent rise in prices of imported vehicles.
Some importers have expressed fears that the new policy could promote smuggling activities.
The
minister’s directive dated November 14, 2013, was also sent to Federal
Inland Revenue Service, destination inspection service providers at the
nation’s seaports and airports, namely Cotecna Destination Inspection
Limited, Global Scan System and SGS Nigeria Limited.
It stated that the approval for the introduction of the new fiscal measures was granted by President Goodluck Jonathan.
