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Former Acting National President of the Association of Nigerian Licensed Customs Agents (ANLCA), Dr. Kayode Farinto, has defended the Federal Government’s Green Tax on imported vehicles, describing the environmental levy as overdue and aligned with global best practices.
Farinto argued that the policy should not be viewed in isolation because the government simultaneously reduced the Import Adjustment Tax (IAT) on used vehicles from 15 per cent to five per cent, lowering the overall import duty despite the introduction of a Green Tax of between two and four per cent, depending on engine capacity.
His words: “I’ve been doing advocacy in the last 15 years and we have never seen a government that is as listening as this one.
“We asked for either the reduction or total removal of the 15 percent levy on used vehicles. Government responded by cutting it to five per cent while introducing a two or four percent Green Tax. That is a welcome development.”
According to Farinto, environmental levies on high-emission vehicles are standard practice in many developed countries. He recalled paying about £30 to drive an older diesel-powered Mercedes-Benz into Heathrow Airport because it failed to meet modern emission standards.
“Nigeria is actually overdue in implementing this policy,” he said.
He posited that the Green Tax supports Nigeria’s environmental commitments by discouraging high-emission vehicles while encouraging cleaner transportation.
Farinto, however, revealed that importers of fully electric vehicles can obtain zero import duty after securing approval from the Federal Government through the Ministry of Finance, adding that he has facilitated the process for several importers.
He maintained that incentives for electric vehicles should be complemented by environmental charges on older fossil-fuel-powered vehicles because of their higher carbon emissions.
Rejecting claims that the Green Tax would increase import costs, Farinto insisted that the reduction in the Import Adjustment Tax more than offsets the new surcharge.
“We are using one stone to kill two birds. Import duties have reduced while Nigeria is complying with international environmental reforms,” he said.
He explained that vehicles with engine capacities between 2.0 and 2.4 litres would attract a two per cent Green Tax, while larger luxury SUVs would pay four per cent, arguing that bigger engines should bear higher environmental costs.
Farinto also defended continued government support for Nigeria’s automobile assembly industry, saying authorities must balance protection of local manufacturers with vehicle importation.
