Uncertainty over reduction in duty on imported vehicles by Customs

Abiola Seun

There was uncertainty in the maritime sector at the weekend over review of Custom duty payable on imported used vehicles, also known as, tokunbo vehicles from 35 percent to 20 percent.

According to clearing agents operating at the nation’s seaports, the Nigeria Customs Service (NCS), downward review was based on the Common External Tariff (CET).

At the CET trade portal, HS Code 87033319, pays 20 percent for clearance of imported used vehicles.

However, Deputy Comptroller of Customs and the National Public Relations Officer of the Service, Timi Bomodi, confirmed the reduction of the tariff, saying it was due to the service migration to the CET’s platform.

Bomodi said, “The service just migrated to the Customs External Tariff (CET), so, it’s not correct. By Monday, it will be adjusted we just migrated to the ECOWAS tariff platform but, we still domesticated our duty rate at 35 percent , it’s just a hitch, it will be adjusted by Monday,” he stated.

He stated that anyone who made payment based on the error on the portal would be made to pay the difference.

But, in a statement by the National Vice President of the Association of Nigeria Licensed Customs Agents (ANLCA), Dr. Kayode Farinto, said, it was agreed that all member states should allow vehicle at 20percent untill we reported to the ECOWAS.

“The proper HS Code for used vehicles before now is 8733320, at 35percent. Meanwhile this negates the CET tariffs, where it was agreed that all member states should allow vehicle at 20percent untill we reported to the ECOWAS.

“I have noticed that some agents have been capturing vehicles under HS Code 87033319 which is reserved for other Fully Built Units (FBU), for assemblers. NCS must make a categorical statement between now and Monday to inform people to continue to capture on 87033320 which has been reduced to 20 percent rate of duty.

“In view of this development, we urge our members not to force themselves to capture on 35percent rate of duty for vehicles henceforth, vehicles will be on 20percent.

The National Secretary of ANLCA, Babatunde Mukaila Azeez, told the members to remain calm, saying the change was not an error but the extant regime.

“Dear professional colleagues, it has been observed that Nigeria Customs service (NCS) has reviewed the duty rate applicable on Common External Tariff (CET) trade portal on vehicles under HSCode 8703 to 20% Duty rate.

“Members are enjoined to remain calm as this is not an error but the extant regime. This has gone a long way to buttress ANLCA position that information and communication gap between NCS and General trading community is still at the lowest ebb. We shall continue to abreast members of this development real time.”