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HomeBusinessTokunbo car dealers to close shop over 15% levy on imported vehicles

Tokunbo car dealers to close shop over 15% levy on imported vehicles

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Car dealers have threatened to shut down their shops this week in a bid to force the Nigeria Customs Service (NCS) to review the recent introduction of 15 per cent National Automobile Commission (NAC) levy imposed on imported used vehicles.

The NCS had recently introduced a 15 per cent NAC on used imported vehicles, a decision both Freight Forwarders and Clearing Agents associations have protested against and threatened to embark on strike to drive home their points.

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

The Lagos chapter of the Association of Motor Dealers of Nigeria (AMDON) is proposing a meeting of its members this week to map out strategies to deal with the situation, according to the official of the association.

“How can we continue to run a system like this? This is really bad and until we get things right in this country, we are not going to move forward. We will have a meeting, come up with a strategy and take a position on that.

“We may stop selling and do some checks and balances because if we are going to sell the ones we have, we are definitely going to buy new ones. The issue is that no one knows the policy they may introduce next week, so, hopefully, before the end of this week, we may stop selling and know what next to do,” chairman of the car dealers association, Metche Nnadiekwe was quoted by Punch on Tuesday.

The AMDON Lagos chair complained that the government was in the habit of not carrying stakeholders along when making certain policies.

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“You know that the Nigeria Customs Service wakes up any time they want and try to introduce something extraordinarily without informing stakeholders.

“Some people are stakeholders in certain businesses and when you want to introduce certain policies, why don’t you consider them? Can’t you even discuss with them to know how these people are going to be affected?

“So, it looks as if it is a calculated attempt to deal with certain people. We don’t really know what is going on here and, remember, wherever there is this type of thing, Nigerians will be the ones that suffer it,” he is quoted as saying.

He said by the time the dealers paid the levy imposed by the NCS, vehicle prices would go so high that many Nigerians would not be able to afford them.

“So, I don’t know whether it is an attempt to take us out of business or what. We keep wondering what is actually going on. Some time ago, it was Vehicles Identification Number and now it is this one,” he concluded.

The National Public Relations Officer of NCS, Timi Bomodi in a recent statement said the new levy was in compliance with the Economic Community of West Africa Common External Tariff.

“On Friday the 1st of April 2022, the Nigeria Customs Service migrated from the old version of the ECOWAS Common External Tariff (2017- 2021) to the new version (2022- 2026). This is in line with World Customs Organization five years review of the nomenclature. The contracting parties are expected to adopt the review based on regional considerations and national economic policy.

“The nation has adopted all tariff lines with few adjustments in the extant CET. As allowed for in Annex II of the 2022-2026 CET edition, and in line with the Finance Act and the National Automotive policy, NCS has retained a duty rate of 20 per cent for used vehicles as was transmitted by ECOWAS with a NAC levy of 15 per cent. New vehicles will also pay a duty of 20 per cent with a NAC levy of 20 per cent as directed in the Federal Ministry of Finance letter ref. no. HMF BNP/NCS/CET/4/2022 of 7th April 2022,” Bomodi stated.

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