15% Levy: Freight Forwarders, Car Dealers Meet FG Next Week

Clearing agents and car dealers will meet with the Ministry of Finance on the 15 per cent National Automotive Council levy slammed on imported used vehicles by the Nigeria Customs Service.

The NCS had recently introduced a 15 per cent National Automobile Commission levy on used imported vehicles, a decision which didn’t go down well with clearing agents in the country’s maritime sector.

The agents have argued that the NAC levy is mostly meant for new vehicles, questioning the rationale behind the introduction of the duty on used vehicles.

In a quick response, the service, in a statement by the National Public Relations Officer, Timi Bomodi, said the move was in compliance with the Economic Community of West Africa Common External Tariff.

Speaking with our correspondent in Lagos, the Ports & Terminal Multipurpose Limited Chairman of the National Association of Government Approved Freight Forwarders, Mr George Okafor, said during the association’s last meeting with the Customs, the NCS said it was acting on the directive of the Ministry of Finance.

“We are now collaborating with vehicle dealers and freight forwarders to meet with the ministry. By next week, the first batch of the meeting will go on. We are going to meet with the Minister of Finance first and after that, we will meet Customs on the VIN valuation.”

Also speaking, a member of the Association of Nigeria Licensed Customs Agents, Taiwo Oyeniyi, said the group believed in dialogue.

“The board is writing to the ministry, we believe in dialogue,” he said.

Meanwhile, the majority of imported used vehicles coming into Nigeria through the TinCan Island Ports and the Ports & Terminal Multipurpose Limited are damaged, findings have shown.

When our correspondent visited the two ports between Wednesday and Thursday, it was observed that some of the imported vehicles were so badly damaged that they could not even move except with the help of towing vans or forklifts.

The Port & Terminal Chapter Chairman of the National Association of Government Approved Freight Forwarders, George Okafor, said that it is cheaper for importers to bring in damaged cars and repair them than buy new ones.

He said that whenever these cars were brought in, the importers would only make a few repairs before using them.

“Damaged vehicles are just like going to the market to buy vehicles overseas. When you want to buy a 2015 model of any car that has not had a dent or accident and you want to buy the one that has had an accident, both do not come with the same cost. The one that has had an accident is always cheaper than the one without any dent.

“Some dealers prefer to buy those ones that have dents or accidents and repair them because they will make more gain while selling them. They buy the clean ones at very high prices over there and when they come back here, they can’t sell.”

Corroborating what he said, a clearing agent, Tochukwu Nwaigbo, told our correspondent that it was cheaper to bring in damaged vehicles and put them in order.

“It is not like people enjoy bringing in accidented vehicles, but it is cheaper, considering the nature of the economy. When you bring in the cars like that, you just spend little and the cars will look like new ones. But if you buy them without dents over there, it will be difficult to sell them here,” he said.

Reacting to this, the Public Relations Officer of the TinCan Island Command of the Nigeria Customs Service, Uche Ejesieme, explained that there was no extant law stopping the importation of damaged cars into Nigeria.

“Well, the truth remains that there is no extant law known anywhere in Nigeria that stops importers from bringing in slightly damaged or ‘’accidented’ vehicles. And when such law is promulgated, then Customs will swing into action and start to regulate.”

Though Ejesieme could not confirm the percentage of the damaged vehicles coming into the country, he admitted that most of the cars coming into Nigeria were damaged.

“So I can’t confirm the percentage, but I will also agree with you that some of the vehicles coming into our clan are either ‘accidented’ or dented. We have two categories: the ‘’accidented’ and the dented.”

According to him, the economic factor may also be another reason for the importation of more damaged vehicles.

“Maybe for economic reason, because I want to believe that some of these ‘’accidented’’ vehicles are cheaper from where they are buying from.

“So, if for economic reasons anybody wants to buy ‘accidented’ vehicles, the law allows that. The only thing the law doesn’t allow is over-age vehicles. Vehicles that are up to 15 years should not come in, but the law doesn’t say ‘’accidented’ or dented vehicles should not come in,” he said.