- Rolls out IVM Connect, IVM 7-seater bus
Government’s plan to reduce the import duties and levies on buses, tractors and her motor vehicles as contained in the recent 2020 Finance Bill will be a disincentive to investments, in addition to setting Nigeria’s automotive industry back by at least 10 years.
This was the view expressed yesterday by the Chairman of Innoson Vehicle Manufacturing Company Limited {IVM}, Chief Innocent Chukwuma, while reacting to “the shocking decision” by the Federal Government, which he said would lead to the forced closure of many auto plants.
The Federal Executive Council {FEC} had on Wednesday, November 18, approved a reduction in duties on tractors from 35 percent to 10; reduction of duties on motor vehicles for the transportation of goods from 35 percent to 10 percent; reduction of levy on motor vehicles for the transportation of persons from 35 percent to 5 percent.
The downward review of duties and levies as well as the introduction of “tax incentives” were intended by government to address the socio-economic problems arising from the COVID-19 pandemic and the recent hikes in the pump price ofpetrol and electricity tariff.
But, reacting to the news from his plant in Nnewi, Chief Chukwuma, argued that a reduction in duties on imported vehicles would lead to massive importation of fully built up vehicles, resulting in unfavourable competition that is likely to run the Nigerian auto makers out of business.
He said the duty review is an embarrassing policy summersault considering that the present charges on imported vehicles were prescribed by the Automotive Policy {the National Automotive Industry Development Plan (NAIDP) to discourage the influx of fully built up products while helping to boost production by the domestic auto plants.
Chukwuma whose plant was officially commissioned in 2010, feared that the
reduction will erase the gains so far made in the industry since the Auto Policy
