Reported by: Ijeoma G | Edited by: Oravbiere Osayomore Promise.
The Federal Government has officially implemented a revised vehicle import levy regime, slashing duties on new and used vehicles by 50 per cent and 67 per cent respectively, as part of the 2026 Fiscal Policy Measures aimed at lowering import costs, stimulating economic activity, and providing relief to businesses and consumers in the automotive sector. The policy, which took effect on July 1, 2026, reduces the import levy on brand-new vehicles from 20 per cent to 10 per cent, while the levy on used vehicles has been cut from 15 per cent to 5 per cent. The government said the measure is designed to ease the cost of imports, stimulate economic activity and provide relief to businesses and consumers in the automotive sector.
Alongside the levy reductions, the government introduced a Green Tax Surcharge on selected categories of imported vehicles as part of its environmental sustainability agenda. The surcharge imposes a 2 per cent levy on imported vehicles with engine capacities between 2,000cc and 3,999cc, while vehicles with engine capacities of 4,000cc and above attract a 4 per cent surcharge. Electric vehicles, mass transit buses, locally manufactured vehicles, and vehicles below 2,000cc are exempt from the surcharge.
While the levy reduction has been welcomed by auto dealers, industry stakeholders say the uncertainty surrounding the exact structure and cost implications of the Green Tax makes it difficult to determine whether consumers will eventually benefit from lower vehicle prices. The President of the National Association of Motor Dealers and Chief Executive Officer of Mitchel Automobile Limited, Prince Ajibola, described the levy reduction as a welcome development but stressed that the full impact would depend on the magnitude of the Green Tax. "We don't know what the surcharge is going to be. If they reduce the levy on vehicles and then introduce another surcharge, we need to know how much it is before we can say there will be any considerable change," he stated.
Ajibola noted that although the reduction in levy on used vehicles from 15 per cent to 5 per cent represents a major concession, the benefit could be neutralised if the Green Tax is substantial. "If the surcharge is far less than what has been reduced, then it's a plus. But if it is the same or even higher, then it has not really changed anything," he explained. According to him, import duties remain one of the major reasons behind the high cost of vehicles in Nigeria, alongside foreign exchange pressures.
The Nigeria Customs Service announced that it would begin implementing the revised import levies alongside the newly introduced Green Tax Surcharge from July 1, 2026. To facilitate implementation, the Service introduced a simplified assessment mechanism through the Harmonised System Code declaration platform. Ahead of the rollout, the Service held a sensitisation programme at the Apapa Area Command on June 26 under the theme, "Implementation of the Green Tax Surcharge and Related Fiscal Adjustments." Representing the Comptroller-General of Customs, the Zonal Coordinator for Zone A, Mohammed Babadende, said the exercise was intended to prepare stakeholders before the policy took effect. "This sensitisation is designed to ensure that every stakeholder clearly understands the policy before implementation. Our objective is to eliminate uncertainty, promote voluntary compliance, and guarantee uniform application of the Green Tax Surcharge across all commands," Babadende said.
Despite the reduction in import levies, dealers said the overall impact on vehicle prices remains uncertain until implementation guidelines become clearer. Some operators expressed concern that while lower import adjustment taxes may provide some relief, the environmental surcharge and other associated charges could still increase the cost of importing some categories of vehicles. The Comptroller in charge of Tariff, System Audit and Coordination, Murtala Muazu, explained that the Green Tax Surcharge differs from conventional fiscal measures and would therefore require a distinct assessment process. He said the Service had introduced a simplified implementation mechanism through the HS Code declaration platform.
The revised tariff regime is part of the Federal Government's broader fiscal reforms targeted at improving the efficiency of Nigeria's customs administration, promoting economic growth, and creating a more business-friendly import environment. Industry stakeholders said they would continue monitoring the implementation of the fiscal measures as the Nigeria Customs Service rolls out the revised tariff structure. They noted that clearer details on the Green Tax would ultimately determine whether the reduction in import levies leads to meaningful price relief for vehicle buyers across the country.
📩 Stone Reporters News | 🌍 stonereportersnews.com
✉️ info@stonereportersnews.com | 📘 Facebook: Stone Reporters News | 🐦 X (Twitter): @StoneReportNew | 📸 Instagram: @stonereportersnews
Add comment
Comments