Good news as FG slashes duty on imported cars to 5%
The Federal Government has concluded plans to slash the levy to be paid on imported cars from 35 % to 5%
The Vice President Yemi Osinbajo said that decision to slash duty on imported cars in the country is not an attempt by the Federal Government to kill the country’s automobile manufacturing industry, but to reduce the cost of transportation on the people in the face of growing economic challenges.
He made this statement in Abuja on Monday at the opening plenary session of the 26th Nigeria Economic Summit (NES#26) on the theme “Building Partnerships for Resilience.”
The move to slash the levy to 5% is contained in the draft copy of the 2020 Finance Bill that may be presented by the executive arm of government to the National Assembly in the days ahead.
Daily Times reports that details of the bill shared by the presidency also show that the import duty of tractors and motor vehicles for the transportation of goods has been slashed from to 10%
He reacted to the views expressed by a panelist, Chidi Ajaere, who said the decision by the government to cut the duty imposed on imported vehicles from 35 % to 5% was a disincentive to prospective and existing investors in the local manufacturing of vehicles.
Mr. Ajaere, who is the Chief Executive of GIG Group, owners of the God Is Good Transport Company, said the sudden change in policy by the government allegedly without consultation had sent wrong signal to prospective investors in the sector.
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He narrated a personal experience on the impact of the inconsistencies in government policies in the country.
He said, GIG Group decided to go into partnership with some foreign investors three years ago to invest in the building of a plant for the manufacturing of ‘made in Nigeria’ vehicles.
Pursuant to the initiative, he said the group spent over N5 billion of private funds, without any loans from the banks, to build the vehicle assembly plant.
He said the government’s decision, without consultations, to cut the duty on imported vehicles from 35 per cent to five per cent appears to have put the project in disarray, as the partners do not know what purpose the sudden policy somersault was meant to serve.
“We have invested all that money. What is going to happen to us (the investors in that vehicle assembly plant) now with the policy summersault? Will the Federal Government com to our aid with incentives for the monies sunk already into the investment?” he lamented.
