Customs proposes 5% levy slash on imported vehicles – TheNigerialawyer

…It’s long overdue, say importers

Cost of used and new imported vehicles is set to drop if the
Ministry of Finance approves the proposal of the Nigeria Customs
Service (NCS) which recommended a reduction of the levy from 35% to
5 or 10%.

The Comptroller-General of Customs, Mr Hameed Ali made the
disclosure while defending the Service’s 2020 budget before the
House Committee on Customs recently.

According to him, the proposal was made with the aim of swelling
revenue and discouraging smuggling as Nigerian importers currently
ship their containers to neighbouring ports where duties and levies
are very low compared to what obtains in Nigeria.

Ali said: “We have forwarded a proposal for the downward review
of vehicle tariff to our supervising Ministry, which is the Finance
Ministry, for consideration so that Customs duty on imported
vehicles remain 35%, while the levy be reduced from the current 35%
to 5 or 10%. This position, if approved, will encourage compliance
and boost revenue because the 70% duty and levy is encouraging
smuggling of vehicles”, Ali told the legislators.

Ali also disclosed that the Service was advocating for the
reintroduction of import taxes on petroleum products.

“The petroleum tax regime of 2004 before its suspension imposed
N1.50k per litre of petroleum products. It is the considered
opinion of the Service that this regime be reintroduced in line
with international best practices as it’s currently operational in
over 36 countries at an average of $2.24 per gallon”.

He also listed some factors that were militating its aggressive
revenue generation.

“We could have done more in revenue generation but there are
factors that made it difficult. We have government policies like 43
items that were banned from forex access by the CBN. It narrowed
down imports due to forex restrictions. It reduced import and
duties we collected. Secondly, most scanners are not working and it
necessitated 100% physical examination of cargo.

“It hampered electronic examination of containers, which is
faster and ensures quicker vessel turnaround.

These scanners were procured in 1997. They came under a
maintenance contract sort of arrangement but we introduced politics
into it. We removed those foreigners hitherto handling them and put
indigenous hands and they have died. We should not buy those type
of scanner again. They keep requiring upgrade of software and
systems and we can’t keep up,” he said.

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