The import bills on used vehicles, popularly known as tokunbo, into Nigeria fell by 83 percent year-on-year, YoY, to N138.62 billion in the first half of the year (H1’24) from N819.15 billion in H1’23 according to the National Bureau of Statistics, NBS.
Quarter-on-quarter, QoQ, breakdown of the National Bureau of Statistics, NBS, ‘Commodity Price Indices’ and Terms of Trade, ToT, report for the review period showed that in Q1’24, no used vehicle was imported compared to N69.23 billion worth of used vehicles that were imported in Q1’23.
In Q2’24, the value of imported used vehicles stood at N138.62 billion, representing an 81.5 percent decline YoY from N749.92 billion in Q2’23.
The report adds that the used vehicles were imported mainly from the United States of America, stating: “On the other hand, total imports from America in Q2’24 stood at N971.84 billion.
Recall that last year, the federal government introduced a new set of taxes on imported vehicles, and the new tax law stipulates that imported vehicles between 2000 capacity (2 litres) and 3999 capacity (3.9 litres) engine will pay an additional charge known as Import Adjustment Tax (IAT) levy of two percent of the value of the vehicle, while vehicles with 4000 capacity (4 litres) and above engines will attract IAT of four percent of their value.
The new levy is in addition to the 35 percent import duty and 35 percent levy being paid by importers of vehicles but vehicles below 2000cc, mass transit buses, electric vehicles, and locally manufactured vehicles are exempted from the IAT levy.