How Importers Short-Change FG Through Importation Of Accidented Vehicles     

Findings by Shipping Position Daily have revealed that the Federal Government may be losing billions of Naira yearly through the slash of 50% duty on importation of ‘accidented vehicles’.

Our correspondent gathered that the influx of salvaged cars also known as accidented vehicles has become the delight of importers especially at the Tin Can Port in Lagos.

Our reporter gathered that seven out of 10 vehicles cleared at the PTML Command of the Nigeria Customs service (NCS) at Tin Can are salvage vehicles which only attract half the duty payable for non- accidented vehicles.

A salvage car is a car that has been labeled not repairable by an insurance company in Europe and United States of America, because the cost of repairing the car is more than the value of buying a new one for the owner of the insurance claim.

In the USA for example, salvaged cars are regarded as unsafe cars that are not worthy of running on the road, until they are properly repaired.

These cars are very difficult to register and re-insure in those countries once they have carried that salvage title, however in Nigeria, this does not apply.

Findings revealed that the moment a salvage car is shipped into Nigeria and repaired by the importer, the salvage title magically disappears.

Speaking with our correspondent on why importers now prefer to import accidented vehicles, a licensed customs agent at PTML Terminal, Mr. Sunny Nnebe blamed the high import duty and levy collected on new vehicles as a major reason.

According to him, “it is simply because of the high duty paid on vehicles that are not accidented; take for instance where vehicles are given 35% duty and probably it might attract levy of 35% and an importer knows that if he brings in accidented vehicle, it will enjoy 50% waiver, so it’s cheaper and better for him than following the government policy”.

Also speaking, a member of the Association of Nigeria Licensed Agents (ANLCA) Mr. Omolagbon Samuel stated that importers find it lucrative to import accidented vehicles because they are cheaper to buy and duty payable on the vehicles is low.

He said “Accidented cars are cheaper to buy, and Nigeria been a place where we have good auto mechanics, when the vehicle comes here, the importer will then repair it and make more profit”.

Also, a car dealer, Yemi Coker who sells vehicles at the Berger Car Mart in Lagos, informed our correspondent that huge revenue running into billions of Naira that should have been accruable to the government through importation of non-accidented vehicles, are lost owing to the influx of accidented vehicles. 

“For us, we don’t deal in accidented vehicles, but we know those that deal in accidented vehicles, but in the first place, why will government allow influx of all manners of accidented vehicles into the country, it’s ridiculous, cars that have been condemned as not fit for the road over there, you now bring it down here for people to use, are you telling me the government over there doesn’t know what they are doing”

“Do you know that Customs is losing billions of Naira through the importation of accidented vehicles, because the full duty on the car is not paid, when you see an accidented vehicle, I am sure you may not recongnise it except I tell you, and they sell it almost at the same or at same price with a car that is not accidented, that’s day-light robbery, and for those you said they are in the habit of purposely denting their cars just for it to be regarded as accidented, well I don’t know, but nothing is impossible in Nigeria,” he said.

However, speaking with our correspondent, the Public Relations Officer (PRO) of Tin Can Chapter command of Customs, Uche Ejieseme stated that the allegation of classifying dented vehicles as accidented is far from the truth, while stating that the command ensures physical examination of cargoes before duty is paid.

“Fundamentally speaking as an organization, we actually don’t work in isolation of the status quo, suffice it to say that we follow extant guidelines in enforcement of fiscal policy of government and in this wise, in regards to the issue of accidented vehicles and some importers coming under the guise of accidented vehicles to defraud government, I will tell you that it actually depends on what angle the man is coming from, because in Tin Can we have a standard”

“Part of what the Controller was able to establish is what we called Standard Operating Procedures that SOP is what we use across board to make sure that everybody is on the same page.

“It is important that we reiterate that once you have your bill of laden, there is what we call ex-factory price, and valuation will give you ex-factory price based on the information on your bill of laden, but there will always be a caveat and the caveat will be that the value is subject to confirmation after physical examination. So if you come and give impression that your car is accidented and after physical examination, it was discovered that it was not accidented, full value will be raised,

He however explained that: “There are two major factors we look at before we can treat a vehicle as accidented; first and foremost, there must be a salvage certificate from the country of export; a salvage certificate declaring as such and also on physical examination we must see very clearly that the chassis must be seen to be affected and also beyond that the airbag, but we don’t actually place too much emphasis on the airbag, because we know with any small force, the airbag can come out”.

“It is not possible for us to see a vehicle that is not accidented and decide to give a rebate of 50% which is supposed to be for accidented”, he stated.