The Federal Government has extended the 35% waiver on imported used vehicles until December this year. Also extended to December is the introduction of a nationwide automotive credit purchase scheme and attainment of the critical capacity by local assembly plants/new investors to meet the estimated national demand. This Nigerian Automotive Industry Development Plan (NAIDP) took effect from Tuesday. Olusegun Aganga, Minister of Industry, Trade and Investment, approved the extension by invoking “a provision in the circular No. BD/FP/DO/09/1/224 of 29 February 2014, as provided for the ministry/NAC to extend the waiver of only 35 per cent levy on used vehicle import from July 1, 2014 to December 31, 2014 in order to manage market conditions.”
The extension was contained in a statement issued and signed by the Director General, National Automotive Council, Aminu Jala, who said his statement was to confirm the full implementation of the NAIDP.
He said, “The implementation of all other aspects of NAIDP remain in force, as the policy is not all about tariff on used vehicles only. Those who engage in local value-added would continue to import new fully built vehicles, twice the number they assemble without levy. The SKD2 kits (semi knocked down) they import at the easiest level of assembly will attract 10 per cent tariff, SKD 1 kits imported at a slightly higher level of assembly will attract five per cent tariff and the CKD kits (completely knock down) will attract zero per cent duty.”
He said his organisation was hopeful that by January 1, 2015, the local assembly plants would have developed sufficient combined capacity to supply affordable vehicles that would meet national demand. By that time, the new automotive credit purchase scheme should have come on stream in order to enhance the capacity of Nigerians, who may otherwise buy used vehicles to now acquire new ones on convenient payment terms.
According to him, “A payment spread over four to five years at single digit interest rate is anticipated.”
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This article was first published on 4th July 2014
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The Federal Government has extended the 35% waiver on imported used vehicles until December this year. Also extended to December is the introduction of a nationwide automotive credit purchase scheme and attainment of the critical capacity by local assembly plants/new investors to meet the estimated national demand. This Nigerian Automotive Industry Development Plan (NAIDP) took effect from Tuesday. Olusegun Aganga, Minister of Industry, Trade and Investment, approved the extension by invoking “a provision in the circular No. BD/FP/DO/09/1/224 of 29 February 2014, as provided for the ministry/NAC to extend the waiver of only 35 per cent levy on used vehicle import from July 1, 2014 to December 31, 2014 in order to manage market conditions.”
The extension was contained in a statement issued and signed by the Director General, National Automotive Council, Aminu Jala, who said his statement was to confirm the full implementation of the NAIDP.
He said, “The implementation of all other aspects of NAIDP remain in force, as the policy is not all about tariff on used vehicles only. Those who engage in local value-added would continue to import new fully built vehicles, twice the number they assemble without levy. The SKD2 kits (semi knocked down) they import at the easiest level of assembly will attract 10 per cent tariff, SKD 1 kits imported at a slightly higher level of assembly will attract five per cent tariff and the CKD kits (completely knock down) will attract zero per cent duty.”
He said his organisation was hopeful that by January 1, 2015, the local assembly plants would have developed sufficient combined capacity to supply affordable vehicles that would meet national demand. By that time, the new automotive credit purchase scheme should have come on stream in order to enhance the capacity of Nigerians, who may otherwise buy used vehicles to now acquire new ones on convenient payment terms.
According to him, “A payment spread over four to five years at single digit interest rate is anticipated.”
