The naira’s depreciation against the U.S. dollar has caused a rise in Customs duties and related taxes at the nation’s seaports.
As a result, importers of used vehicles, commonly referred to as Tokunbo, have expressed difficulties in bringing cars into the country.
It is worth noting that since the naira’s floating, the Central Bank of Nigeria (CBN) has reviewed the exchange rate used for customs duty on multiple occasions.
It would be recalled that TimesNow.com.ng earlier reported that Nigeria’s import bill on imported used vehicles dropped by 83% yearly to N138.62 billion in the first half of 2024 from N819.15 billion in the same period in 2023.
Addressing journalists, the President of the Association of Motor Dealers of Nigeria (AMDON), Prince Ajibola Adedoyin, highlighted that increased taxes, petrol prices and tariffs have significantly slowed the vehicle import business.
He explained that the federal government’s naira floatation and fuel subsidy policies have negatively impacted vehicle imports at Nigerian ports.
According to Leadership, Adedoyin added that many importers have been driven out of business, with severe consequences for their members.
He noted that a major concern for the general public is the potential safety risks, as the current situation has led to the recycling of old cars already in use within Nigeria. This could pose significant safety issues in the long run.
He said:
He further disclosed that importers have turned to recycling old and used vehicles due to the sharp decline in vehicle imports. However, Adedoyin cautioned that this practice could lead to more frequent accidents and vehicle breakdowns.
The rising foreign exchange (FX) rate has significantly increased import duties, making them skyrocket. He cautioned that if the government does not act, the higher exchange rates, transportation costs, and public safety will be at serious risk.
Meanwhile, TimesNow.com.ng earlier reported that the Nigeria Customs Service had introduced a 90-day window for importers to resolve vehicle importation problems.
This adjustment process involves meticulously completing all importation paperwork and inspections to ensure compliance with the standards set by the federal government.
The initiative aims to proactively improve compliance and optimise import procedures within the country.
Source: TimesNow.com.ng
