Car dealers appeal for suspension of new import tariff

Chairman of Abuja Car Dealers Association, Mr Auwal Rilwan, has appealed to the federal government to suspend the new vehicle import tariff till local vehicle manufacturers begin full operations.

The tariffs were imposed to discourage importation of used vehicles and encourage local manufacturing.

Rilwan, speaking to NAN, said that implementing the policy now would lead to shortage of affordable cars for low income earners and loss of job to many people.

He asked the government to first put the necessary infrastructure in place for local manufacturers to produce enough cars to meet demand before discouraging importation.

The new tariff, which the Nigeria Customs Service began to implement on May 1, is 35% import duty and another 35% port levy.

It is a key component of the Nigeria Automotive Industry Development Plan (NAIDP).

Before the new tariff policy, imported vehicles attracted 20% duty and 2% levy.

Rilwan said that the new tariff had doubled the clearing cost of imported cars and was impacting negatively on the country’s automobile market.

“I have some cars waiting to be cleared at the Lagos ports but Customs is telling me to pay 35% import duty and another 35% port levy on them.

“Before now it cost about N250,000 to clear one car but with this policy, we will be paying at least N400,000.

“If you add the cost of ancillary services like transportation, loading and off-loading, among others, very soon Nigerians will stop buying ‘tokunbo’ cars due to their high price.

“Government should wait for the investors that are coming to start producing affordable vehicles to meet local demands before limiting importation,” he said.

The director-deneral of National Automotive Council (NAC), Mr Aminu Jalal, said recently that without increase in vehicle tariff, investors would not be encouraged to establish assembly plants.

“Unless the hike in tariff starts, no company is ready to invest hundreds of millions of dollars in setting up assembly plants in the country.

“I know people will say let them come, set up their plants and produce before the new tariff kicks off but the truth is they will not do it.

“Except the new tariff starts, the auto policy is just another government promise and no investor will take action on a promise because it will mean we are not serious,” he told NAN.

He had also allayed the fears of car marketers about being thrown out of business, saying that the council would register them to be dealers to the emerging local vehicle manufacturers.