₦airaland Forum

Nigeria’s import bills on used vehicles, popularly known as tokumbo, fell by 83 percent year-on-year, YoY, to N138.62 billion in the first half of the year (H1’24) from N819.15 billion in H1’23.


Quarter-on-quarter, QoQ, breakdown of the National Bureau of Statistics, NBS, ‘Commodity Price Indices’ and Terms of Trade, ToT, report for the review period showed that in Q1’24, no used vehicle was imported compared to N69.23 billion worth of used vehicles that were imported in Q1’23.

In Q2’24, the value of imported used vehicles stood at N138.62 billion, representing an 81.5 percent decline YoY from N749.92 billion in Q2’23.

NBS noted that the used vehicles were imported mainly from the United States of America, stating: “On the other hand, total imports from America in Q2’24 stood at N971.84 billion.

Recall that last year, the federal government introduced a new set of taxes on imported vehicles, among other things.

The new tax regime stipulates that imported vehicles between 2000 capacity (2 litres) and 3999 capacity (3.9 litres) engine will pay an additional charge known as Import Adjustment Tax (IAT) levy of two percent of the value of the vehicle, while vehicles with 4000 capacity (4 litres) and above engines will attract IAT of four percent of their value.


The new levy is in addition to the 35 percent import duty and 35 percent levy being paid by importers of vehicles.

However, vehicles below 2000cc, mass transit buses, electric vehicles, and locally manufactured vehicles are exempted from the IAT levy.

The government also revised the import prohibition list with the inclusion of used motor vehicles above 12 years from the year of manufacture.


But in March this year, the Nigeria Customs Service (NCS) announced the suspension of the 25 percent import duty penalty on improperly imported vehicles.

marenkurz:
Graduate students in ordinary South Africa drive brand new cars. Except you're corrupt, you can never afford a brand new car in Nigeria.

treesun:
in Q1’24, no used vehicle was imported compared to N69.23 billion worth of used vehicles that were imported in Q1’23.

MadPolitician:
The increase in tariffs at the ports was a well thought out idea to kill off imports. On the surface, it looks like the government was operating with an altruistic mindset to stimulate local production. But when you take into consideration, the fact that there has been practically no new inventive policy to cause anything close to a "production revolution" in Nigeria by Tinubu and his gang over the last two years, it starts to dawn on you that the mafia in power, has a totally different agenda. Or maybe totally bereft of ideas.

You dont orchestrate local production by just closing boundaries and quadrupling import tariffs on essential basics. You do so by creating solid industrial banks, with warehoused funds to lend to serious entrepreneurs at reasonable interest rates, improving power, identifying productive areas where businesses in the country can have competitive advantages vis a vis foreign competitors, training the youths in different skills acquisition projects to help produce quality products that are good enough for the international markets.

We are not yet doing any of those. Even the local car manufacturing facilities, are left on their own as they fight with banks for their money. Most of the parts they use for production, are imported and these imports go through the new high imports tariff regime, thereby effecting the price of the final products locally. In essence, Tinubu is now earning less at the ports from car imports, because by hiking import tariffs, he has chased away the real importers, yet can not earn anything as taxes from any new companies springing up, because his total economic strategy is chasing away businesses, rather than helping them.

treesun:
https://www.vanguardngr.com/2024/09/import-bill-on-used-vehicles-drops-83-to-n138-62bn/

ednut1:
Nigerians have resorted to pimping older cars with new body parts like bebex and co