National PRO, Nigeria Customs Service, Deputy Comptroller Timi Bomodi

The Nigeria Customs Service has denied the alleged 10 per cent hike in tariff on imported used vehicles, saying it does not make policies but only implements fiscal policies of the Federal Government.

This is coming against the backdrop of allegations by the Association of Motor Dealers of Nigeria that the service has effected a 10 per cent increment of import duty on imported used vehicles into the country, especially in the last few weeks.

Speaking on an Arise Tv news interview, National Public Relations Officer of the service, Deputy Comptroller Timi Bomodi, noted that there was no iota of truth in the claims by the motor dealers, insisting that the service does not have the powers to impose or arbitrarily increase duty payable on any item imported into the country.

He also noted that the service in agreement with relevant stakeholders comprising vehicle importers, freight forwarders and clearing agents introduced an automated system called the Vehicle Identification Number VIN Valuation System, which determines the value and import duty payable on any vehicle based on the make and year of manufacture of the said vehicle without any human interference or intervention.

He further disclosed that the introduction of the new automated system, which came on stream about two years ago, was in response to protests by clearing agents over the manual determination of the value of imported vehicles and duty paid on them by the valuation officers of the service, which was calculated then based on the tariff books and year of manufacture of the vehicle in question.

“The service has already tackled the issue of arbitrary hike in the tariffs on used vehicles, we have an automated system called the VIN Valuation System. What it does is that it traces the make and model of each vehicle starting from the year of manufacture and begins to calculate the value at the time based on a fixed rate of depreciation and the appropriate value is attributed to that vehicle.

“At the time we launched the system, all stakeholders including vehicle dealers, freight forwarders and clearing agents present and we agreed that the values to assess these vehicles were appropriate and they accepted and embraced them. This new system was introduced because the agents themselves protested because valuation officers were using the books and ex-factory price and rate of depreciation to calculate the value manually.

“So we now have an automated system devoid of any manual influence; when you input the VIN, it will automatically tell you the value of the vehicle and the appropriate duty to pay. I do not really know where these complaints are coming from because as at last year, there were no such complaints from the agents about the value the VIN protocol is producing.

“But we should also realise that we are talking about values and in the market places, values are not static, they always change, and when they change, and you come to clear the goods, the duty we are supposed to collect will reflect the current realities. So all these should be taken into consideration when assessment for values are being made. But largely, it is still an automated system devoid of any manual interference and the rate of depreciation is also calculated”, the PRO said.

On the increasing revenue profile of the service, DC Bomodi noted that the service was given a total of N3.0trillion revenue target last year, out of which it collected a total of N2.63trillion at the end of December, 2022. Contrary to insinuations, he disclosed that the increasing revenue was not as a result of imposition or arbitrary hike in tariffs.

He however attributed the upsurge in revenue to the automation of the Customs’ systems, which, according to him, has led to more efficiency in its core responsibility of trade facilitation, improved processes and blockage in revenue leakages not tariff imposition or hike.

Meanwhile, chairman, Lagos chapter of the association of motor dealers, Mr. Metche Nnadiekwe, who also featured on the Arise TV interview, insisted that there was an astronomical rise in the tariff paid on used vehicles, especially in the last three or four months.

He cited an instance whereby duty paid on a certain category of used vehicles increased from N600, 000 to N1.6million within a period of three-four months and had just been increased again by about N500, 000 in the last two weeks, which he argued constitutes a course for concern, given current economic realities in the country.

Nnadiekwe said: “When we pay these amounts and you know we are selling to Nigerians; you know what would happen. In fact, currently, we are not selling because of high prices. The families of these dealers are suffering, where would Nigerians get the money to pay these high prices?

“Go to most vehicle dealer shops, everything is stagnant, schools have resumed after Christmas and New Year, we cannot sell to send our children back to school. I think that some of us in this business should be consulted before these hikes in duty but what rather happens is that when you wake up, you see that another increment has been done.

“It does not augur well, it makes us feel that we are nobody, but we are contributing to the economy of this nation, we are providing employments to people, who would have been armed robbers or kidnappers but instead of the government commending us, the government is punishing us with increment in tariffs without consulting us.”