Business

Customs VIN valuation to cause congestion at nation’s ports

As agents abandon vehicles due to high duty

BY ADAKU WALTER

Nigerian ports may witnessed heightened upheaval, which may led to  congestion in clearance of vehicles due to the alleged high inputs of  vehicles cost imported into the country by the Nigeria Customs Service (NCS).

Vice President of Association of Nigerian Licensed Customs Agents (ANLCA) Dr. Kayode Farinto, in a chat with journalists, said the Vehicle  Identification Number (VIN) valuation policy introduced for all imported
vehicles was not helping the nation’s economy, as it lacked  predictability and had been unable to drive revenue collection.

He said for the last one week, clearance of vehicles has been stopped  due to the outrageous VIN values by the Customs. VIN was recently introduced by the NCS to give a uniform and  acceptable value to all imported vehicles into Nigeria not minding the  port of landing. Hitherto, vehicles of the same year and made are often  charged different duties in different ports in Nigeria.

Narrating the difficulty being experienced by Freight Forwarders and Customs Brokers, Farinto said the main purpose of VIN valuation for  imported vehicles has been defeated even as thousands of imported  vehicles are currently trapped at the seaports. “We won’t get tired of informing the Nigerian government what is  happening in the industry. In the last one week, our members were unable  to clear vehicles from the ports, as a result of introduction of VIN.

“Why should we opt for VIN valuation? Before now, I was one of those  that said there was no uniform value on the clearance of vehicles. For  example, if you have 2015 Camry at Tin Can, Apapa and PTML, you will  never pay the same duty on them and these vehicles are going to the same  market.

“This is causing serious unease for our members, it encourages  corruption and it is making us not to have predictability. One of the  first criteria of Central Bank of Nigeria (CBN) is that there must be  predictability in Customs clearance. Hence, we now say okay, give us  uniform value or key into that of Ghana system, that is where the issue  of VIN came onboard,” Farinto said.

It is expected that the Customs should implement any policy by  collaborating with stakeholders, especially the licensed Customs  brokers, adding that Customs needed to subject their value to public criticism for stakeholders to make their inputs.

However, he argued that the introduction of VIN was not helping the  economy, as it had made the clearance of cargoes, particularly vehicles  that have been stagnant in the last four days and accumulating demur-rage
in the ports. “We are now calling on Customs to invite us, subject the values to  criticism because you cannot shave our head in our absence. The legal  notice 30 talks about ware and tear, rebate, once a vehicle is bought in
2022 in America, if you buy a car on January 1 and you drive it from  Houston to Texas to the far north, once it is used, it depreciates, 10  per cent depreciation law applies. It is the same thing everywhere in
the world. It is a standard thing.

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“It is unfortunate in Nigeria now because of the fact that nobody cries  out, but importers are feeling it. These agents entered into agreement  with their importers; collecting bills of lading, charge them before  arrival of the vehicles. The vehicles arrive now, but the agents are  unable to clear them because we are introducing VIN valuation.

“We are not saying you should not introduce VIN valuation. What we are  saying is that, if you look at the value in the VIN valuation, it is  outrageous. For example, I have three examples here, I look at the  system and I look at MAZDA 2007 model, the system is giving them over  $5000. And what is the value of 2007 vehicle in the market? You can even  view it in American market.

Another one, we have a Honda 2013 that was bought for around $6000 or  $7000. If you access the VIN value, it will give you over N2 million as  duty and if you convert it to dollars, that is over $15000. These are  things that are killing our economy. Another one is 2009 Honda, which  ordinarily, the system is giving over $6000, meanwhile, it is less than $2000 when we were clearing it,” he said.

Farinto, who insisted that the purpose of embracing the VIN is to  ensure reduction of the human contact, discourages corruption and  enhances uniformity, said it is only in Nigeria that it would turn to a  Banana Republic and it is becoming discouraging and frustrating, even  clearing agents are seriously agitating.

“The VIN should be such that when you clear your vehicle, anywhere  within Nigeria, the moment you access it through the VIN, nobody queries  you on the road, no Customs officer will stop you on the road
unnecessarily.

“But because Customs lacks professionalism, they have not worked in  tandem with the tariff and valuation departments, because if they did  all these things would have been harmonized and that is why we are where we are now,” he added.

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