In a bid to promote made in Nigeria goods and also ensure looking inwards to boost local production, the Federal Government has raised duties on luxury goods such as yachts and Sport Utility Vehicles (SUVs) imported into the country.
The newly reviewed import duties cut across various goods, SUVs, boats and Sports cars, will now attract 70% duty (previously 20%); Rice, Alcohol and Tobacco now 60% (from 10 and 20%).
Sugar and salt 70% (from 10%); packaged cement 50% (from 10%); Cotton/ fabrics materials 45% (from 35%).
Essential industrial service components including bolts, industrial oil and other equipment down to 5%
Some drugs and other foods are also being slammed with higher tariffs including Anti-malarial drugs and antibiotics; palm oil; wheat flour; tomatoes paste cassava products
The policy which is coming on the heels of the recent ban by the Nigeria Customs Service (NCS) on all vehicle imports through the land borders in the country, as part of measures to curb smuggling of particularly used cars into the country is going to see citizens pay higher for used cars popularly known as ‘Tokunbo.”
The smuggling of cars into the country may have dealt a very big blow to the customs’ revenue generation as the budget minister recently announced that the NCS’ projected revenue for the third quarter of this year fell short of expectation by N100 billion, recording N200 billion instead of N300 billion target given to the agency by the Federal Government.
According to the Finance Minister, Buhari has already approved the new tariff regime.The circular reads in part: “This is to confirm that Mr. President has approved the 2016 fiscal policy measures made up of the Supplementary Protection Measures (SPM) for implementation together with the ECOWAS CET 2015 – 2019 with effect from 17th October, 2016.
“Consequently, all transactions prior to the effective date of this circular shall be subjected to the tariff rates applicable before the coming into effect of this 2016 fiscal policy measures.”
It added that the approved SPM was in line with the provision of the ECOWAS CET comprising the following:“An Import Adjustment Tax (IAT) list with additional taxes on 173 tariff lines of the extant ECOWAS CET; national list consisting of items with reduced import duty rates to promote and encourage development in critical sectors of the economy; an import prohibition list (Trade), applicable only to certain goods originating from non-ECOWAS member states.”
Adeosun declared that the current fiscal policy measures superseded those of 2015, and advised the customs and other stakeholders to ensure strict compliance.
Recall that the Federal Government had earlier banned importation of vehicles and rice through land borders on Dec. 5. The order is expected to be effective from Jan. 1st 2017. The ban according to the FG covers both old and new vehicles.