President Muhammadu Buhari has signed a new directive which empowers the Nigeria Customs Service (NCS) to implement the price slash on duty for imported vehicles into the country.
The President by his order seeks immediate compliance of the service with the directive targeted at curbing the rising cost of transport and provide a boost for the mass transit industry.
The price reduction would see import duties drop from 35% to 10% and even 5% in some cases depending on the category of the vehicle.
It will be recalled the federal government had announced plans to slash the levy to be paid on imported cars. The development is contained in the draft bill of the 2020 finance bill, which was sent to the national assembly.
The bill has been passed by the lawmakers and now assented by President Buhari, giving room for the full implementation.
The palliative also includes zero or free import duty on aviation engines and spare parts.
A directive on the implementation of the new import duty regime is contained in a circular from the Nigeria Customs Service (NCS), dated 18th February, 2021, and signed by Deputy Comptroller-General (T&T), T.M. Isa on behalf of the Comptroller General of the NCS.
The circular had a reference number: A HMF/BNP/CUSTOM/FA. 2020/02/20 Dated 8 Feb 2021, was titled T&T/2021 CIRCULAR N0.5 Grant of the Presidential Assent of Finance Act. Act 2020.
It reads in part: “Pursuant to the assent by Mr. President to the Finance Act. 2020 to support the implementation of the 2021 Budget of Economic Recovery and Resilience, certain changes to the fiscal framework regarding the importation of specific automotive vehicles into Nigeria have been introduced.
“These reforms are designed to reduce the applicable levies and duties on vehicles, mitigate rising transport costs, boost road transportation and mass transit industry.
“Arising from the aforestated, Section 38 of the Finance Achief, 2020 modefied the First Schedule to the ECOWAS Common External Tariff (CET), Etc (Consolidation ) Act by amending applicable duties and levies as follows:
“a) Reduction of Import Duty on Fully Built (FBU) of Agricultural Tractors (HSHS Headings 8701from 35 per cent to 5 per cent as applicable.
b) Reduction of Import Duty of Fully Built Unit of Motor Vehicles for the Transport of persons (cars) (HS Headings 8703 from 35 per cent to 5 per cent as applicable.
“c) Reduction of Import Duty of Fully Built Unit (FBU) of Motor Vehicles for the Transport of Goods (HSHS Headings (HSBC Headings 8704) from 35 per cent to 10 per cent as applicable.
“4. Furthermore, the Act also introduces fiscal incentives for the Aviation Sector. For the avoidance of doubts airlines registered in Nigeria, which provide commercial air transport services by owning or leasing aircraft are to enjoy free importation of aircraft, engines, spare parts and other components.
“5. Ensure wide circulation for immediate compliance, please”.
In other news, the Presidency has said that Nigeria exited recession due to the success of the Federal Government’s ongoing Economic Sustainability Plan (ESP).
Recall that the National Bureau of Statistics (NBS) had in a report said Nigeria’s economy grew by 0.11 percent in the fourth quarter of 2020 after two consecutive quarters of negative growth which resulted in a recession.
But in a statement on Sunday, Laolu Akande, spokesman of Vice President Yemi Osinbajo, said the implementation of the plan was responsible for the good news.
He asked Nigerians to expect more good development as the implementation of the plan continues to impact Nigerians positively. Akande said the Q4 report shows that the recovery of Nigeria’s economy is on a steady path.
