The Federal Government has released the details of new duties and levies payable on imported new and used vehicles as well as imported new tyres from next year, raising the tariff from 20 per cent to 70 per cent.

Dealers of imported vehicles estimated that the new rate would translate into an increase of 60 per cent on imported cars.

The Federal Executive Council had last month approved a new national automotive policy aimed at encouraging local production and assembling of new vehicles with an imposition of a high import tariff on fully built vehicles. But the new rate was not given then.

A two-page document dated November 14, 2013 and signed by the Minister of Finance, Dr. Ngozi Okonjo-Iweala, gave the new import tariff on cars as 70 per cent (of the cost of each vehicle).

It stated that a fully built car would attract a duty of 35 per cent and a levy of another 35 per cent of the cost of the vehicle.

Hitherto, importers/dealers parted with 20 per cent and two per cent as duty and levy, respectively on new cars. Ten per cent flat rate was also imposed on commercial vehicles.

Although the new tariff on cars shows an increase of 48 per cent over the old rate, dealers have estimated that the showroom price of an imported car will rise by 60 per cent when other variables (costs) are added.

In other words, prices of imported cars currently being sold between N3m and N5m will shoot up to N4.8m and N8m; while tokunbo vehicles selling for N800,000 will rise to N1.28m.

Those who spoke with our correspondent on the issue on Sunday also warned that there might not be enough vehicles to meet the demand of the country next year.

A sales manager with one of the major dealers said, “Many of us are skeptical about ordering for new vehicles because we don’t know if people would be ready to pay the about 60 per cent increase on the cars when the import duty and levy are added to the original cost of purchase.

“Even the supplies by local plants will obviously be grossly inadequate to meet the demand.”

The document, with reference number BD/FP/DO/09/189, also stated that fully built commercial vehicles would attract 35 per cent duty but no levy imposed.

Specifically, it stated, “Local assembly plants shall import completely knocked down (vehicles) at zero per cent duty; and semi-knocked down (vehicles) at five per cent duty.

“Local assembly plants shall import fully built unit cars at 35 per cent duty and 20 per cent for commercial vehicles without levy, respectively in numbers equal to twice their CKD/SKD kits.

Imported tyres would also cost more as from next year as 20 per cent duty and five per cent value added tax have been placed on tyres of cars, buses and lorries.

“Local tyre manufacturing plants are to import tyres at five per cent duty in numbers equal to twice their production for two years from the date of commencement of production,” it stated.

Similar high tariff will also be charged on used vehicles, according to the document. It added that the Nigeria Customs Service “shall use the value of a new vehicle depreciated by 10 per cent per annum, implying 10 years period of cars and by seven per cent per annum implying 15 year period for commercial vehicles. In either case, depreciation should never be below 30 per cent of the value of the new vehicle equivalent.”

Source: punch newspaper, 25th November, 2013
http://www.punchng.com/news/prices-of-imported-cars-to-rise-by-60/

FG is always looking for ways to make things hard for the poor man, as long as it brings them more money to loot.

What better alternatives have they provided? How many of them are driving Innoson?

Innoson Cars ko.. Amosun Ni!

Mr. Jonathan, 549 Days Left!!

I like dis move. Now dis a strategy to make brands like toyota and hyundai and co to open up here by next year. but I'm afraid if Nigerians will start coupling cars, you might be driving and your tire will just fly off from your car.

Innoson Cars Manufactured in Nigeria a Nigerian brand should be the hottest cars in this country if we were not such crabs

And people will say Goodluck is clueless, this is an excellent move. When I returned to Nigeria I wept at the number of SUV on Nigerian roads, I factored in the colossal amount Nigeria loses to these cars, I suggested that govt should impose high tariff on them in some countries I have been in they impose up to 150 percent. So I say it is a very good move by GEJ and Okonjo Iweala. And this will encourage local production and job opportunities, once again, nice move.

djon78: And people will say Goodluck is clueless, this is an excellent move. When I returned to Nigeria I wept at the number of SUV on Nigerian roads, I factored in the colossal amount Nigeria loses to these cars, I suggested that govt should impose high tariff on them in some countries I have been in they impose up to 150 percent. So I say it is a very good move by GEJ and Okonjo Iweala. And this will encourage local production and job opportunities, once again, nice move.

U forget that some people are struggling to raise money ro buy the present tokunbos. These manufacturers av not evn sited any plant here...hw many years b4 they setrle down? Is there infrastructure for them to begin production? Please its an ill thought move.

Great news! Everyone will now be FORCED to buy made in Nigeria (or assembled in Nigeria) vehicles. If we complain of lack of jobs, we should also be ready to take the necessary job creation injections.

mitwitdot:


U forget that some people are struggling to raise money ro buy the present tokunbos. These manufacturers av not evn sited any plant here...hw many years b4 they setrle down? Is there infrastructure for them to begin production? Please its an ill thought move.

is it poor people that buy cars and is it not a shame that price of tokunbo cars here is almost the same as price of new cars in manufacturing countries.....please support what is good without sentiments

Brimmie: Innoson Cars ko.. Amosun Ni!

Mr. Jonathan, 549 Days Left!!

yeah 549 days left for APC to resume their crying and ranting
u guys just can't help crying

[b]We have past this road before: The main thing is that the Fed Govt is dead broke! They are just looking for any means to sustain their ever increasing quest for corrupt enrichment. Or how else can one describe the slamming of high tariff on imported cars without first of all addressing the gap that may crop up due to the policy? Why not do a gradual increase on tariff while allowing the local manufacturers time to do the needful?

What happened to the tariff slammed on rice importation? Has it helped boost local production thereby creating jobs? Are Nigerians not still dependent on foreign rice for sustenance albeit on higher price?

What happened to the Fuel subsidy removal? Has it led to the building of local refineries? Has it created Jobs as we were tutored? Where is the SURE-P? Has it created any new job?

Look all these are just wicked policies targeted at the poor masses, no matter how they are coated by Ngozi Okonjo! The rich and the corrupt would always find their way.

Jonathan, we have had enough of your cluelessness [/b]

Sincere 9gerian: Great news! Everyone will now be FORCED to buy made in Nigeria (or assembled in Nigeria) vehicles. If we complain of lack of jobs, we should also be ready to take the necessary job creation injections.

How many people could afford the Tokunbos in the first place.....let alone brand new??

Anamco and PAN have been assembling cars for ages, what are the state of these companies as they are dying off.
Innoson is a nig company that moulds and couples vehicles here.

All I am asking govt is to give more fund to Innoson, Anamco and PAN to increase their production rate to meet demand.
These move will increase the rate of employment.

Goodluck Nigeria

ba7man: How many people could afford the Tokunbos in the first place.....let alone brand new??

few people cos the rich are few ,can u now see that it is not an anti-poor policy?

How does this affect a Nigerian living abroad that wants to relocate to Nigeria with his cars.

We he be made to pay duty on his own used car? They need to clarify this change in policy.

Telling a Nigerian to pay 70% duty on his belongings on coming home is equivalent to telling him to remain abroad forever.

ba7man: How many people could afford the Tokunbos in the first place.....let alone brand new??

I heard the policy will go side by side with car loans. Moreover, some brand new Innoson vehicles are cheaper or atleast the same price range with imported Tokubo vehicles. We have to take certain difficult decisions to move this country forward.

Sincere 9gerian:
I heard the policy will go side by side with car loans. Moreover, some brand new Innoson vehicles are cheaper or atleast the same price range with imported Tokubo vehicles. We have to take certain difficult decisions to move this country forward.

I disagree with you on this issue...when you say "difficult decisions", who makes the sacrifices- is it the struggling masses or the big political Appointees, elected officials in Abuja?

THESE SO CALLED LEADERS WILL NEVER BREAK A SWEAT FOR THIS COUNTRY...They would rather seek for avenue to benefit and corruptly enrich themselves further from these policies. Most of them have become the latest billionaires in town in this present dispensation and how many of them can allow thier children drive Innoson?....its could av been better if these car manufacturers av started producing locally before making these drastic policy.

fabulous4u:
yeah 549 days left for APC to resume their crying and ranting
u guys just can't help crying

Ori e o pe!

Brimmie:
Ori e o pe!

eeyah he don dey cry o....a beg give hankie....this one na test running tears the real one will happen in 2015

9jagirl4re: Innoson Cars Manufactured in Nigeria a Nigerian brand should be the hottest cars in this country if we were not such crabs

true

www.nairaland.com/attachments/1374659_20131021003637295_jpg46c2adbff508fc26adb257f9dc52e208

www.nairaland.com/attachments/1374658_20131021003703968_jpg75216701e3db11d569ad29d49a9839be

Sincere 9gerian:
I heard the policy will go side by side with car loans. Moreover, some brand new Innoson vehicles are cheaper or atleast the same price range with imported Tokubo vehicles. We have to take certain difficult decisions to move this country forward.

Explain the part in bold. Who will provide these loans? Who will access them? At what rate and over what repayment period?

Hope it will not affect farming equipment ? Smh

mitwitdot:

I disagree with you on this issue...when you say "difficult decisions", who makes the sacrifices- is it the struggling masses or the big political Appointees, elected officials in Abuja?

THESE SO CALLED LEADERS WILL NEVER BREAK A SWEAT FOR THIS COUNTRY...They would rather seek for avenue to benefit and corruptly enrich themselves further from these policies. Most of them have become the latest billionaires in town in this present dispensation and how many of them can allow thier children drive Innoson?....its could av been better if these car manufacturers av started producing locally before making these drastic policy.

How many unemployed or poor people have you seem planning to buy a car? It is the rich and middle class that buy cars. What the unemployed and poor masses need is not cheap cars but jobs, jobs, jobs, and more jobs. That is exactly what the policy intends to do- create more jobs locally.

Sincere 9gerian:
How many unemployed or poor people have you seem planning to buy a car? It is the rich and middle class that buy cars. What the unemployed and poor masses need is not cheap cars but jobs, jobs, jobs, and more jobs. That is exactly what the policy intends to do- create more jobs locally.

A similar policy to "create" jobs and make Nigeria a major rice exporter have resulted in Nigeria being a major smuggler's paradise, despite farming being less complex than making cars.
What is your boss doing to prevent a repeat of this failure?
Since his only solution is to increase tariff on everything and inflict pain on the less privileged, I have a better solution for him. Just ban all poor people from Nigeria and his problems will be solved.

If unemployed should not buy cars, I assume they still need to eat. But did it stop your boss from putting in place a similar half hearted policy on rice which he had no genuine interest in seeing through?

egift: FG is always looking for ways to make things hard for the poor man, as long as it brings them more money to loot.

What better alternatives have they provided? How many of them are driving Innoson?

This regime is very necessary, if the dealers are smart they have to encourage their brand manufacturers to set up a depot in Nigeria for a start, I give u an example, in most European countries the manufacturer have depots where they don't have factories or assembly plants and still enjoy favourable tax and tarief regime, cars appear cheaper in Germany but when I bring that car to Belgium to register for use I will be paying more than I am supposed to if I had bought that same model in Belgium.

Nigeria has become a big market for cars, it's a way of asking the manufacturer to directly invest in the country if they want benefit in expanding their brand.

For now it difficult for our pocket but it benefit the country in the long run.

Aigbofa:

A similar policy to "create" jobs and make Nigeria a major rice exporter have resulted in Nigeria being a major smuggler's paradise, despite farming being less complex than making cars.
What is your boss doing to prevent a repeat of this failure?
Since his only solution is to increase tariff on everything and inflict pain on the less privileged, I have a better solution for him. Just ban all poor people from Nigeria and his problems will be solved.

If unemployed should not buy cars, I assume they still need to eat. But did it stop your boss from putting in place a similar half hearted policy on rice which he had no genuine interest in seeing through?

It's GEJ duty to make a favourable policies and delegates the enforcement through the ministers, if u get my drift u will understand that it's the common man that is twarting his efforts.

Nigeria is financially broke! There is no need for this policy. What the government needs to do is to get rid of all import waivers at all levels. This new policy will affect a lot of people at various levels. This policy is a job killer.

payless: Nigeria is financially broke! There is no need for this policy. What the government needs to do is to get rid of all import waivers at all levels. This new policy will affect a lot of people at various levels. This policy is a job killer.

are you the federal government Abi what's this fish saying

Brimmie: Innoson Cars ko.. Amosun Ni!

Mr. Jonathan, 549 Days Left!!

lmao is it now apc that will change things, haha with the two hungry politicians that are afraid all their lootings will soon run dry, now coming together to form an alliance

ogb5: How does this affect a Nigerian living abroad that wants to relocate to Nigeria with his cars.

We he be made to pay duty on his own used car? They need to clarify this change in policy.

Telling a Nigerian to pay 70% duty on his belongings on coming home is equivalent to telling him to remain abroad forever.

I think in that case u need to have your number registration/license, conformity, valid insurance, and mot papers to prove that u were using the vehicle, but I am not so sure.

okpara ugo: Hope it will not affect farming equipment ? Smh

Farm equipment/Commercial vehicles up by 20%.