The Nigerian Government has slashed the levy to be paid on imported cars popularly called Tokunbo in the country from 35 per cent to five per cent.
This is stated in the draft bill of the 2020 Finance Bill to be presented to the National Assembly.
The bill, which was recently approved by the Federal Executive Council will become law after it is passed by the legislature and assented by President Muhammadu Buhari.
The import duty of tractors and motor vehicles for the transportation of goods has also been slashed from 35 percent to 10 percent.
Companies that donated to the COVID-19 relief fund under the private sector-led Coalition against COVID-19 (CACOVID) are granted tax relief in the bill.
Also, in order to improve ease of doing business in the country, the bill proposes that software acquisition now qualifies as capital expenditure.
On Wednesday, November 18, 2020, the Minister of Finance, Budget, and National Planning, Zainab Ahmed, had said that the reduction in import duties and levies was meant to reduce cost of transportation.
She said, “The reason for us is to reduce the cost of transportation which is a major driver of inflation especially food production.”
The minister said this while addressing state house correspondents at the end of the Federal Executive Council (FEC) on Wednesday.