Col. Hameed Alli (Rtd.), Comptroller General of NCS

Import Duty: Freight forwarders kick as Nigeria Customs changes age limit of vehicles, ‘jeopardises economy’

*Members of the Association of Nigerian Licensed Customs Agents at the Tin Can Island Port, in Lagos, allege the Nigeria Customs Service has failed to implement ‘depreciation rate’ on import duties, but changed age limit of vehicles from 2013 to 2014 without consultation with damaging consequences on the economy

Emmanuel Akosile | ConsumerConnect

There is palpable tension at the two Roll-on Roll-off (RORO) vehicle terminals in Lagos Tin Can Island Port and PTML Terminal over the latest hike in import duty payable on vehicles in Nigeria.

It was gathered the genesis of the anxiety among the freight forwarders was due to the changes in age limit of vehicles from 2013 to 2014, by the Nigeria Customs Service (NCS).

Imported vehicles mart

By implication, any in imported vehicles year lower than 2014 now will be made to pay duty of 2014 vehicles, according to report.

It was also alleged the NCS had failed to adjust the regulatory Service’s system to effect the depreciation value on all vehicles in line with international standards and customs practice.

“The Nigeria Customs Service are tax robbers; they are not professionals,” stakeholders reportedly said.

In 2022, the Nigeria Customs Service had pegged the age limit of vehicles coming into the country from 15 years down to 12 years; hence the least duty value payable on any vehicle imported was year 2013 duty, report noted.

In view of the development, licensed customs agents who spoke with Daily Trend Wednesday, January 4, 2023, however, purported that after returning from the festive season celebrations, they discovered the Customs had switched its systems to a fresh calendar for the year 2023.

According to them, this development has further increased the least duty payable on imported vehicles in the West African country.

Freight forwarders reportedly said the least value payable on cars now is pegged at year 2014, even as they alleged that Customs failed to implement depreciation value on the duties in line with international standard.

The duty payment for a Toyota Corolla vehicle has now jumped from N299,000 to N334,000, they alleged.

Speaking on the situation in the industry, Mr. Remilekun Sikiru, Youth Leader of Association of Nigerian Licensed Customs Agents (ANLCA) at Tin Can Island Port and Coordinator of Five Star Terminal, in Lagos, disclosed on January 2, 2023, the Nigeria Customs Service automatically, switched to the next calender year, which ordinarily should have been done by April 2023.

Sikiru stated: “On this note, the lowest import duty now is 2014 applicable to all vehicles.

He said, for example, the lowest duty of a Corolla now is N334,000 as the lowest, as against N299,000 being paid before.

The ANCLA leader, however, said: “But the good thing they (Customs) have done is that they try to reduce the duty of 2015 and above a bit by encouraging the importers to bring in more vehicles of advanced year of manufacture to the country.

“Critically, NCS has failed again to implement the 10 percent depreciation value on the system for all the vehicles in the next calendar year, which is absurd.

“I believe it’s time for the stakeholders to strike in.

“The NCS failed again to tandem with the critical stakeholders before implementing this policy, knowing full well that we are just coming from a festive holiday.

He lamented there was no prior notice ahead, and yet a lot of professionals have some pending jobs, the profit of which they had spent during the festive period.

The question, according to Sikiru, is how will they go about it?

Sikiru further stated: “All we are hearing is the government want to increase the duty by 0.5% VAT, which we are yet to hear from the Minister for Finance to make publication on that.

“Importation has dropped by 70%, yet the government fails to take a review but all they are after is generating revenue which is deteriorating, derailing and jeopardising the economy.”

NCS flouts global regulation on depreciation value: Agents

In his remarks on the development, Mr. Timothy Adebowale, another licensed Customs agent,  lamented that the value clearing agents were paying on 2014 cars in the year 2022 is what they are still paying in 2023.

“When the Customs knew that their system could not accommodate a vehicle of 2013 when we enter into the year 2023, the percentage of depreciation rate last year on a 2014 vehicle was 80%, while a 2013 vehicle was 90%.

“Now that we are in 2023, what stops the customs from effecting the depreciation rate on 2014 vehicles to 90%?”

He also argued: “Every year, the vehicles depreciates, Customs is supposed to effect it, such that if there is going to be any increment, it’s going to be little.

“It is an international rule, not applicable to Nigeria alone.”

Adebowale stressed the Nigeria Customs Service is only eager to generate revenue for the Federal Government, not minding the pains of the Nigerian consumers.

According to him, the NCS calendar year starts April of every year, but they have rushed to change it to January because they want to impress the Federal Government.

“The Nigeria Customs Service are tax robbers; they are not professionals, they are hiding under the pretense of generating revenue for the federal government.”

Kindly Share This Story