Friday, 2 January 2015

New tariff on used vehicles takes off April 2015

                                
Following pressure from stakeholders, the Federal Government, yesterday shifted ground on the implementation of the 70 per cent tariff on imported used vehicles by postponing its enforcement to April 30, 2015.

This is the third time in six months that the tariff implementation date would be shifted.
It was first moved from July 1, 2014 when the government decided to implement the policy in two phases of 35 per cent apiece to January 1, 2015.
The government said then that the arrangement was to enable local vehicle assembly plants ramp up production in order to meet the nation’s demand for brand new vehicles.
However, in a statement, the National Automotive Council, NAC, said it had deferred the implementation of the new tariff to April 30, 2015.
Director-General, of NAC, Aminu Jalal, said in the statement that the postponement was due to the delay in the establishment of a vehicle finance scheme.
He said: “The arrangements for the establishment of the affordable vehicle finance scheme suffered a delay of about four months due to the Ebola virus disease. The staff of the collaborating bank, Wesbank of South Africa, delayed their planned trip to Nigeria to set up operations from September 2014 to January 2015. Hence, the new date for the commencement of operations of the financing scheme is April 2014. Accordingly, the Minister of Finance has been asked to extend the levy deferment on used cars to April 30, 2015.
“The automotive policy has five elements, one of which is market development. Under market development, tariffs are increased on FBU vehicle imports. These tariffs are to be reduced gradually over the years, as the vehicle assembly and local content operations gain momentum.”
Jalal said that Nigeria’s vehicle market was about 400,000 units annually, with about 300,000 being imported as second-hand.
He said that the government had introduced measures to balance the vehicle supply and make them affordable, with the production by the local assembly plants.
“The assembly plants will import two FBU at concessionary duty for every one CKD/SKD they assemble in 2014/15. It will be one to one in 2016/17,” he said.

Source: Vanguard 

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