The implementation of the policy of import duty reduction from 35 per cent to five percent on passenger transport vehicles in commence immediately, a Nigeria Customs Service (NCS) circular confirmed on Sunday.
The announcement followed the confirmation that President Muhammadu Buhari has approved for the take-off of the policy contained in the 2020 Finance Bill approved by President Muhammadu Buhari.
Under the new policy directive, which sought to cut down on applicable levies and duties on vehicles to mitigate the rising transport costs and boost the mass transit industry during the pandemic. importers of aviation engines and spare parts would also enjoy zero or free import duty.
The circular dated February 18, 2021 was signed by the Deputy Comptroller-General (T&T) of the NCS, T.M. Isa, on behalf of the Comptroller General, Hammed Ali.
The NCS said the policy was to support implementation of the 2021 Budget of Economic Recovery which culminated in the adoption of various changes in the fiscal framework, including those on importation of automotive vehicles into the country, to boost economic recovery.
The circular No. A/HMF/BNP/CUSTOM/FA. 2020/02/20 titled T&T/2021 CIRCULAR N0.5 Grant of the Presidential Assent of Finance Act. Act 2020 reads in part:
“Pursuant to the assent by Mr. President to the Finance Act. 2020 to support the implementation of the 2021 Budget of Economic Recovery and Resilience, certain changes to the fiscal framework regarding the importation of specific automotive vehicles into Nigeria have been introduced.
“These reforms are designed to reduce the applicable levies and duties on vehicles, mitigate rising transport costs, boost road transportation and mass transit industry.
“Arising from the aforestated, Section 38 of the Finance Act, 2020 modifies the First Schedule to the ECOWAS Common External Tariff (CET), etc (Consolidation) Act by amending applicable duties and levies as follows:
“a) Reduction of Import Duty on Fully Built (FBU) of Agricultural Tractors (HSHS Headings 8701) from 35 percent to 5 percent as applicable.
b) Reduction of Import Duty of Fully Built Unit of Motor Vehicles for the Transport of persons (cars) (HS Headings 8703) from 35 percent to 5 percent as applicable.
“c) Reduction of Import Duty of Fully Built Unit (FBU) of Motor Vehicles for the Transport of Goods (HSBC Headings 8704) from 35 percent to 10 percent as applicable.
“4. Furthermore, the Act also introduces fiscal incentives for the Aviation Sector.
“For the avoidance of doubts, airlines registered in Nigeria, which provide commercial air transport services by owning or leasing aircraft are to enjoy free importation of aircraft, engines, spare parts and other components.