The National Vice President of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr Kayode Farinto, has said that improper planning led to the rejection of the recently suspended Vehicle Identification Number (VIN) valuation of Customs at the ports.
Speaking with the Nigerian Tribune in Lagos, the Wealthy Honey Investment boss explained that disparity in Customs duty led to the call for a proper valuation for imported vehicles.
According to the ANLCA chieftain, “Before VIN valuation came onboard, what we had was each Customs Command issuing value for any vehicle that arrives at the ports. We call it ex-factory price. This ex-factory price actually emanates from Belgium. What Customs does is to forward details of whatever vehicle that arrives to Belgium to get the ex-factory price and then give us the clearing agents to pay.
“For example, if you have a 2014 Camry vehicle, the Legal Notice 30 talks about the law of depreciation. A 2014 Camry, even if it is $10,000 on Customs book before now, it is enjoying a minimum of 40 per cent rebate. So, if it is $10,000, you now multiply it times-minus 40 per cent. Eventually, the value might be around $6,000 or $5,000. The Customs valuation unit will then give you that value for you to go and pay as your duty.
“However, we had a problem, and the problem was that for the Camry 2014 model or any other vehicle, Customs Command in Tin-Can, PTML, Apapa or the land borders will never give you the same duty value. If you end up paying N800,000 for a Camry 2014 in Tin-Can Customs, Apapa Customs will tell you that the duty for the same make of vehicle is N1 million, PTML will tell you that the duty is N1.2 million, at the land border you might get N1.4 million as duty.
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“This was the problem that existed before VIN valuation was introduced. Customs commands were giving different values for the same make of vehicles at their commands. This disparity in duty value of imported vehicles was giving us (clearing agents) problems because these vehicles are going to the same market. Even after leaving the ports, the vehicle is still accosted by officers of the Federal Operations Unit (FOU), Zone A that the true value has not been paid. This was the situation that necessitated the introduction of VIN.
“I was among those that told the Comptroller-General of Customs (CGC) about a year ago that we should look at the Ghana system where once you input your VIN number, the system gives you the duty to pay. The CGC then directed that a committee comprising some Customs officers and some clearing agents should be set up to look at the whole idea and come up with something fantastic.
“Instead of setting up that committee, Customs just drafted two of its management staff to set up the VIN valuation and they slammed it on Nigerian importers. Where they got their data from, only God knows where. For example, the 2014 Camry that I used as an example earlier, under this VIN valuation, it will give us $17,000 instead of the $6,000 that it used to give before VIN valuation came onboard.
“A lot of things were not put into consideration. The law was not put into consideration. Legal Notice 30 is a law which talks about wear and tear or rebate, it was not put into consideration before they (Customs) slammed the VIN valuation on us. All that Customs did was to input internet value in the VIN valuation and then slammed it on us. This is criminal and unfair to Nigerian importers because it will lead to people buying vehicles for maybe $6,000 and clearing it with $24,000. This was what led to protests at the ports because a lot of things were not put into consideration.
“If Customs had set up a committee as directed by the CGC, the committee would have subjected the policy to criticism before implementation,” Farinto said.
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