Car dealers are attributing the seizure of 533 vehicles with a duty paid value of N2.92 billion by the Nigeria Customs Service between January and November 2023 to the exorbitant duty rates imposed on clearing imported goods, particularly vehicles.

Dealers expressed that the elevated duty rates, introduced by the Federal Government through the Central Bank of Nigeria, have compelled car importers to seek alternative methods of manipulating the importation process rather than adhering to the standard procedures.

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Earlier this month, it was reported an increase in duties payable on imported goods at Nigerian ports due to a rise in the exchange rate for cargo clearance mandated by the Federal Government through the Central Bank of Nigeria.

This marked the fourth adjustment to the exchange rate for cargo clearance within the year.

The Central Bank had modified the exchange rate from N422.30/$1 to N589/$1 in June, followed by adjustments to N770.88/$1 in July and N783.174/$1 in November.

Providing an update on the situation, Abdullahi Maiwada, the National Public Relations Officer of the Nigeria Customs Service, disclosed that 533 vehicles with a duty paid value of N2.919 billion were seized between January and December 2023.

In response to these developments, Tai Olaniran, the Secretary-General of Lagos State Motor Dealers Association, criticized the high duty rates, asserting that they have compelled importers to resort to smuggling as a means of bringing in vehicles.

Olaniran emphasized the need for the government to reduce duties on goods, including vehicles, to discourage smuggling and promote legitimate importation.

He argued that lower duties would not only discourage illicit practices but also contribute to increased government revenue.

In light of these challenges, dealers are reportedly shifting their focus to purchasing Nigerian-used vehicles instead of direct tokunbo imports.

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Chinonso Amariwu, a car dealer at Berger Automobile Market, echoed similar sentiments, stating that the higher duty rates have fueled an increase in smuggling activities.

He cited an incident where a colleague’s vehicle was intercepted by customs officers due to improper clearance, emphasizing the correlation between elevated duty rates and the rise in unapproved route smuggling.