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FG To Slash Levy On Imported Cars From 35% To 5%

Plans are underway to slash the levy paid on imported cars from 35 percent to five percent.

The proposal is contained in the draft bill of the 2020 finance bill which will be presented to the National Assembly.

It will become effective once it is passed by the legislature and assented by President Muhammadu Buhari.

Also in the draft, the import duty of tractors and motor vehicles for the transportation of goods has been slashed from 35 percent to 10 percent.

The proposed bill also grants tax relief to companies that donated to the COVID-19 relief fund under the private sector-led Coalition against COVID-19 (CACOVID).

FG To Slash Levy On Imported Cars From 35% To 5%

The bill also proposes that software acquisition now qualifies as capital expenditure.

Minister of Finance, Budget and National Planning, Zainab Ahmed had previously explained that the reduction in import duties and levies is targeted at reducing the cost of transportation.

“The reason for us is to reduce the cost of transportation which is a major driver of inflation especially food production,” she had told state house correspondents at the end of the federal executive council (FEC) on Wednesday, November 18.

The comptroller-general of the Nigeria Customs Service, Hameed Ali had in 2019, appealed to the Federal Government to reduce the levy paid on imported cars to 10 percent, saying the 35 percent import duty usually discouraged importers and make them divert their importation to neighbouring countries and heightened smuggling.

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