Car imports are subject to duties, which are determined by the vehicle’s size, engine capacity, and year of manufacture. Newer cars manufactured after 2016 will be subject to a levy charge of 35 percent, duty of 35 percent, and a final tax of 70 percent. Used vehicles will pay 35 percent duty. Your vehicle’s carrier, such as a shipping business, will be charged for shipping; these costs are only affected by the weight and size of your car. Shipping costs are higher for trucks and SUVs. The sum of all of these expenses is the cost of clearing cars in Nigeria.
The price of clearing automobiles in Nigeria at Tin Can Port, Cotonou (Seme Border), Apapa Port, and other ports in order to deliver them to a client in Nigeria will be listed in this post. For this to be carried out effectively, fees like port fees, clearing agent fees, and Nigerian custom duty fees on imported autos must also be paid. The method through which the Nigerian Customs Service (NCS) charges for clearing cars changed as of last year. Now they charge based on the cost of the car rather than the year it was made, instead of the year it was made.
In This Article...
Request for the car’s bill of lading
The overseas shipping agency has just handed you this very crucial document. You may be sure to receive the original document on time because Nigeria has reliable courier services like FEDEX and DHL. You might ask for it to be sent to your home address so you can quickly print and utilize it without paying for a courier service. This document is extremely important because it contains information on the vehicle, including the name, model, Vehicle Identity Number, weight, and ports of origin and discharge.
Send an application for import duty valuation
This is a basic step, but if you are unaware of the procedures, it could get complicated. You must write a letter on the letterhead of an authorized clearing agency, affix the car’s bill of lading, and deliver the entire package to customs. You should anticipate a response from the recipient after sending this letter through the correct channels, in which they will state the vehicle’s real value in dollars and use that to calculate the 35 percent surface charge. A further 35 percent tax to the custom is to be expected if your vehicle is brand new.
For instance, a $5000 automobile must pay an import charge of 534,975 naira to cross Nigerian customs. As follows is the formula:
$5000 times 35% times 305.7 is 534,975. (in which 305.7 is the official dollar exchange rate from customs)
The aforementioned sum does not include tax or any other costs; it is just used to calculate import duty valuation.
Update and register the valuation into custom database
The information will be entered into the custom server once you have received your duty valuation. This procedure is frequently referred to as Direct Trader Input (DTI). This suggests that you are sending a customs service an electronic manifest, which is achievable thanks to a registered clearing house. At this point, you must identify yourself using the consignee’s Tax Identification Number (TIN).
As soon as you’re finished, print the Single Goods Declaration form (SGD) and the Assessment Notice. The SDGF form must include detailed information about the vehicle, including its kind, the amount of duty owed, and any contents it may have.
If you are unfamiliar with the procedures, your car may remain at the port for a very long time.
Import duty payment
The automobile import duty payment is one of the payments you must make to the bank. This needs to be done as you send the Nigeria Custom Service an electronic manifest. When making the payment, be remember to bring the Assessment form with you to the bank. You have the option of making this payment online or at any bank branch. After you’ve made the payment, be sure you receive a receipt.
What does clearing an automobile in Nigeria Port cost?
In a chat with journalists on Thursday in Lagos, the immediate past national chairman of the Association of Nigerian Licensed Customs Agents, Emmanuel Ogu, stated that the policy would increase the cost of doing business and place a significant financial burden on Nigerians importing goods, including cars.
Due to the prolonged strike, at least 12,000 imported automobiles are currently stuck at the port.
The strategy has resulted in an increase in the price of clearing a car at the port from N300,000 or N400,000 to N800,000.
It is not at all tenable, according to Ogu. Affected parties are the importers. It won’t be good for this country because it will affect both the agents and the end-users.
In Nigeria, how much is the car custom duty?
Nigeria’s maritime sector has been mired in controversy for a number of weeks as a result of the Nigeria Customs Service’s implementation of the 15% National Automotive Council charge. ANOZIE EGOLE explores how this policy would affect the car sector.
Under the cover of the National Automotive Council levy, the Nigeria Customs Service administration proposed adding a 15% surcharge to the already high cost of processing imported vehicles in April 2022, but they did not anticipate the upheavals and difficulties the scheme would cause.
The directive could best be described as a victim of circumstances because it came at a time when the clearing agents working at the nation’s ports were already under pressure due to the implementation of the Vehicles Identification Number for the valuation of imported vehicles, even though the Service claimed that the directive was from the Federal Ministry of Finance and that it was only being implemented.
The artificial intelligence guidebook known as the VIN value on imported used vehicles, which controls documentation procedures in an electronically digitized format, was born out of need. The services claimed that they handled differences in tariffs owed on vehicles that were the same manufacturer, year, and model.
The NCS early last month reviewed duty on imported used cars from 35 percent to 20 percent, which was in compliance with the directive from the Common External Tariff of the Economic Community of West African States, while the VIN was still causing controversy, which ultimately led to the platform’s suspension for 30 days.
The Service, dissatisfied with the ECOWAS directive on duties, went further and implemented the 15% NAC levy, allowing it to recover the 15% of the former import duty on imported used vehicles, bringing the duty payable on imported vehicles back to the level it was prior to the ECOWAS directive at 35%.
Used imports will still be subject to a 35 percent import charge that is made up of a 20 percent import duty and a 15 percent NAC levy.
In a statement, NCS spokesperson Timi Bomodi said that the new pricing was in accordance with the modifications outlined in the protocol for the Common External Tariff of the Economic Community of West African States, to which Nigeria is a signatory.
“On Friday, April 1, 2022, the Nigeria Customs Service moved from the 20172021 ECOWAS Common External Tariff to the new version, 20222026,” the announcement said. This is in keeping with the nomenclature’s five-year assessment by the World Customs Organization. The review is anticipated to be adopted by the contractual parties based on local factors and national economic policy.
“The country approved all tariff lines with only minor changes to the current CET. In accordance with the Finance Act, the National Automotive Policy, and the provisions of Annex II of the 20222026 CET edition, NCS has maintained the 20 percent tariff rate for used cars that was conveyed by ECOWAS with a 15 percent NAC levy. According to the Federal Ministry of Finance’s letter Ref. No. HMF BNP/NCS/CET/4/2022 on April 7, 2022, new automobiles will also be subject to a 20 percent tariff and 20 percent NAC charge.
It is noteworthy that domestic fiscal policy on the importation of autos and other goods has as its goal expanding the local economy in these areas. The NCS is concentrating on implementing these policies in the hopes that it will accomplish its goals in accordance with the National Automotive Policy and other governmental fiscal policies.
“In Chapter 98 of the present CET Bonafide Assemblers are to benefit from a concession of 0% and 10% Duty rate, respectively, while importing Completely Knocked Down CKD and Semi Knocked Down SKD. The tariff rates for the same goods are 5 and 10 percent inside ECOWAS, respectively. Long-term success for the country is ensured by rewarding their efforts through policy measures. Please put into practice the current CET right away.
The introduction of the 15% NAC levy was seen as illegitimate and in violation of financial regulations by Nigerians. Even though they did not accomplish the goal of the levy, they claimed that the main purpose of the NAC levy, which was 2 percent when it was established, was to promote domestic auto manufacture.
Lucky Amiwero, a former member of the National Automobile Commission committee, claimed that the controversial 15 percent tax imposed on imported cars by the Nigeria Customs Service was against the country’s Finance Act.
“Well, the situation there is still unclear because the law states that the 15% is on the NAC. I participated in the committee meeting that invalidated the NAC law, and the NAC bill barely received two percent of the vote.
Therefore, increasing NAC to 15% is prohibited. It is unlawful. When you consider the entire policy, it isn’t very clear and doesn’t make sense. This is made clear in the circular that the minister released in March. The migration agreement, which Customs signed, merely involves leaving the Harmonized System Code of the World Customs Organization. And as you migrate, you discard a lot of things that are no longer relevant for global trade.
Amiwero said that the 2014 NAC law only included a 2 percent insurance collecting.
2014 saw the passage of the National Automotive Design and Development Council (NAC) statute. You are breaking the NAC legislation if you are collecting more than the 2 percent allowed under the financial provision for insurance charges.
Additionally, he said that the 15 percent fee was not included in either the 2001 or 2020 Finance Acts.
Merchandise Processing Fee (MPF)
Most shipments that enter the country are charged this tax by US Customs. With a minimum of $27.23 and a maximum of $528.33, it is computed at 0.3464 percent of the entered value (the cost of the goods as entered on the commercial invoice you give your customs broker). For instance, the MPF is $346.40 if the shipment’s entered value is $100,000.
Harbor Maintenance Fee (HMF)
On shipments that arrive in the country by ocean transportation, US Customs collects the HMF. It amounts to 0.125 percent of the value entered. The HMF for that $100,000 shipment would cost $125.
Bond Premiums
You pay a surety firm these fees via your broker. Through that company, US Customs receives a guarantee that you will file the Import Security Filing (ISF) and that you will pay any duties or fees associated with your goods. You’ll most likely purchase a continuous bond, which covers all of your ISF submissions and customs entries for a year, if you import frequently. A $50,000 continuous bond has an about $500 premium. US Customs may request a $100,000 or $200,000 bond, which is obviously more expensive, if you are a significant importer or you bring in high-value cargo.
You can get a single-entry bond if you just sometimes import freight. Actually, you’ll require two of themone for ISF coverage and the other for actual customs clearance. The ISF bond costs roughly $75, while the customs bond costs between 0.45 and 0.5 percent of the entered amount.
Customs Broker’s Fee
Customs and Border Protection (CBP) issues licenses to customs brokers in the US, who represent you in all dealings with US Customs. Brokers prepare and submit the required paperwork using the information you supply and keep track of how your shipment is moving through Customs. To get your bonds, they also collaborate with surety firms. The broker’s price varies depending on the variety and complexity of services it offers, just like with other professional engagement.
You do not save money on import and clearing fees when you transport less-than-containerload (LCL) freight by consolidating shipments for various importers into one container. Each shipper whose cargo is contained in a consolidation container must finish a separate customs clearance and pay the related fees.
How much does clearing a 40 foot container cost in Nigeria?
Containers are used to transport items during imports and exports. From Europe to America, Asia, and Africa, products are stored, transported, or received in containers during trade by sea, which is one of the oldest methods of goods transit known to man. These shipping containers are composed of steel, exist in a variety of sizes, and come in a number of distinct varieties, each with a specific function for the cargo it will transport. They are made to survive extreme weather, and some builders use them as raw materials to build offices, homes, schools, and other structures. To move commodities from one location to another, these containers are moved not only on ships but also on rail and vehicles. Typically, storage containers are 40 or 20 feet long and 8 or 8.6 inches high.
The Lagos seaport is utilized for trade by both the government and private parties or businesses.
Prices of Containers in Nigeria
Here in Nigeria, 40-foot, 20-foot, and 10-foot containers are the most popular sizes. We’ll examine the many used or empty containers for sale in Nigeria.
Prices Of 40ft Containers
A 40-foot container in Apapa, Amuwuo-Odofin, Ikoyi, and Ikeja in Lagos costs between 1,200,000 and 1,300,000 Naira. This size of used container will cost between 1,200,000 and 1,250,000 Naira.