“No Minister” Delays Auto Policy Implementation

"No Minister" Delays Auto Policy Implementation

FOR the fourth time in one year, the Federal Government yesterday postponed the full implementation of the nation’s automotive policy to an undisclosed date.

The full implementation of the policy earlier scheduled to commence 1/7/2015, has been put on hold until the appointment of substantive ministers.

The policy was earlier scheduled to commence in July 2014, then to January 2015, April 2015 and July 1,2015 before the new development.

Already, the first phase of the policy involving 35 per cent duty increase has come into effect while the second phase of 35 per cent increase was scheduled by the immediate past administration to commence yesterday.

In a chat with The Guardian yesterday, the Director General, National Automotive Council (NAC), Aminu Jalal, an engineer, explained that the agency requires the approval of the ministers of Finance and that of Industry, Trade and Investment before taking further step on the policy implementation.

He explained that the agency lacks the power to take further action, “only minister of Industry, Trade and Investment and the minister of finance can direct us (NAC) on what to do next”.

Meanwhile, stakeholders in the maritime sector especially importers yesterday lamented the impact of the policy on their business transactions.

They alleged that while the policy has prevented them from importing legally, smugglers are having a field day using illegal routes through the land borders to bring vehicles into the country.

Under the new automotive scheme, the Federal Government in 2013 raised the duty and levy payable on imported used cars from 20 per cent to 70 per cent, pointing out that the initiative was aimed at encouraging local production of automobile.

Information made available to The Guardian explained that Fully Built Units (FBU) cars falling under H.S.Code 87.03 shall attract a duty of 35 per cent and 35 per cent levy.

On the other hand, Local Assembly plants shall import their Completely Knock Down (CKD) at zero percent duty, Semi Knocked Down (SKDI) at five per cent duty and Semi Knocked Down (SKD11) at 10 per cent import duty.

According to NAC, all machinery and equipment imported for the purpose of vehicle assembly shall attract zero percent import duty and be free of Value Added Tax (VAT).

Speaking at a ‘Town Hall Meeting on the National Automotive Policy’, recently some stakeholders in the maritime sector advised necessary government agencies to ensure that auto assembly plants start rolling out locally assembled vehicles at affordable price before the policy is implemented.

They also accused some auto assembly plants of allegedly hiding under the policy to import fully-built units of vehicles under the guise of semi-knocked down (SKD) units with the intention of defrauding the government of import.



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