The cost of importing vehicles, including mass transit units, and other imported commodities could increase by as much as 20 percent in the coming weeks. Read the story here:
• Nigeria should begin to look inwards for vehicle assemblage, says MamuduThe possibility, experts have warned, would worsen the fear of a commuting crisis and the imminent increase in the poverty level. They added that the increase would complicate the inflation outlook, especially as Nigerians still rely majorly on importation for essential consumption.
In the past eight years, the Customs exchange rate has continued to increase due to weakening naira. That has increased hardship for the masses and increased the cost of production for manufacturers. Professor of Transport and Logistics at the Lagos State University , Samuel Odewumi, said the removal of subsidy and increase in customs duty rate is not helpful for the transport sector and the economy.
Deputy Managing Director of CFAO Motors, Kunle Jaiyesimi, also said the change would further increase the landing cost of vehicles and selling prices. He said it would hurt new vehicle acquisition and fleet decisions of companies. For most citizens, he said, transportation is critical to their survival, adding that the hike in transport fares and the corresponding inflationary effect is already posing a threat to the livelihood of many, both within and outside the public sector.
Suggesting solutions, Yusuf advised the government on the right fiscal policy interventions in the interest of social justice and stability, which include waiving import duty, value-added tax and other port charges on Semi Knocked Down parts for the assembly of mass transit buses immediately. Also, the World Bank, in its Macro Poverty Outlook for Nigeria: April 2023, stated that about 13 million Nigerians would fall below the national poverty line by 2025.
Amiwero cautioned the government to be very careful about policies and their implementation, which will affect the people and the economy. He advised the government to have a quick resolution of all these issues and the need for a concerted effort to cushion effect and provide palliatives for the situation.
Unfortunately, NCS was able to generate N2.6 trillion with a shortfall of over N4 billion, but the former Comptroller-General of the service, Hameed Ali, attributed the shortfall to bureaucracies in government policies, and others such as the fluctuation of the naira, fiscal policies and border issues among others.
He said the owners were already paying huge demurrage on the vehicles, adding that with the new customs rate, the vehicles will continue to stay there attracting more demurrage, which can lead the owners to abandon them. “Don’t forget the importer still pays illegal taxes to non-state actors on vehicles who harass containers, vehicles among others,” he lamented. Also, the Public Relations Officer, Tin Can Island Port Chapter, ANLCA, Onome Monije, said importers were already struggling to bring their trapped vehicles out of the ports, which accrued a lot of demurrage due to high duty, adding that with the new duty rate, it could spell doom in the import industry.
Customs had in April 2022, migrated from the old version of the ECOWAS CET Tariff to the new version in line with the World Customs Organisation five years review of the nomenclature.
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