According to the currency rate published on Customs’ official website, the Nigeria Customs Service (NCS) has increased the exchange rate for cargo clearance at the port from N422.3/$ to N589.45/$.
As a result of the increase in the exchange rate, importers and manufacturers carrying goods into the country’s seaports would now pay more in import tax tariffs, with N167.15 added to each dollar of the total amount used to compute duty.
Using an imported vehicle as an example, the importer is required to pay 20% import duty and 20% levy, totaling 40% of the total value of the vehicle.
Customs will automatically generate the value on the Vehicle Identification Number (VIN) Valuation system utilizing the chassis number of the vehicle in question to estimate the monetary value.
For example, if the VIN-Valuation system assigns a value of $10,000 to the car in question, the importer must pay 40% of that amount in import duty and levy.
To calculate the expected duty to pay to Customs, also known as the surface value, the dollar value of $10,000 will be translated to naira using the Customs exchange rate of N589.45 per $, and the 40% would be paid as tax and levy.
Furthermore, the importer is required to pay Customs Licensed Agents for VAT, surcharge, ECOWAS Tax Liberalization Scheme (ETL), terminal charges, shipping charges, and clearing charges.
Tony Anakebe, a Licensed Customs Agent, told our correspondent that the impact of higher exchange rates on cargo clearance at the port will be huge because importers will be paying more as Customs tax.
“If an importer paid N1.2 million to clear a 2012 model vehicle when the exchange rate was N422.3 per $, such a person should be prepared to pay about N1.5 million or more going forward,” he said, adding that importers of 20-foot and 40-foot containers, which used to pay duties of about N3 million and N5 million, respectively, should be prepared to pay more going forward depending on the nature of the goods.
Anakebe stated that Nigerians are outraged by the high prices of commodities on the market, and that the new situation will drive inflation even higher because importers will always peg the price of finished items to cover all costs.
On the impact of naira depreciation and high exchange rates on the value of automobiles in Nigeria, Aissatou Diouf, general manager of Suzuki by CFAO, told media on Friday that market pricing for automobiles would continue to rise as long as exchange rates remained high.
She revealed that Nigeria Customs has increased its tariff payment exchange rate to around N600 per $.