As part of its plan to eradicate smuggling of vehicles into the country, the Nigerian government has introduced an innovative plan, the National Vehicle Registry Policy (VREG) to curb the illegal act. This revolutionary system incorporates comprehensive vehicle information from various governmental bodies, such as the Nigeria Customs Service, Vehicles Inspection Offices, the Police, National Central Vehicles Data, and the Federal Road Safety Corps’ vast database. This initiative would put an end to custom duty evasion among vehicle importers, as stated by Wale Edun, the Minister for Finance and Coordinating the Economy, during the VREG Zonal Sensitisation Campaign held in Abuja.
According to him, the task of overseeing the nation’s financial matters and revenue sources falls upon the Federal Ministry of Finance. At this stage, the government must act swiftly and effectively to address these challenges related to the sharp decline in revenue such as the plummeting oil prices and the worsened state of the mono-economy due to unchecked customs duty payment evasion and other revenue loopholes. Also, the lack of a dynamic and centralized national vehicle information platform further adds to the woes.
Nigeria lacks a comprehensive vehicular database.
Despite having the highest number of imported vehicles in Africa and a staggering figure of 15 million operational vehicles within the country, Nigeria currently faces a significant void as it lacks a comprehensive vehicular database. The immense void faced by the system was the result of various issues like evading customs duties, insufficient data for policy-making concerning vehicles, widespread administration loopholes leading to revenue loss, rampant vehicle theft and crime, difficulties in enforcing road traffic regulations, inadequate access to credit facilities, and ineffective vehicle insurance coverage, and monitoring and evaluation.
Since its inception in 2021, VREG has yielded numerous advantages for the registry. One notable benefit is its role in reducing the avoidance of customs duty administration.
Edun stated that VREG has successfully united with the significant stakeholders present at the event, thereby fostering instant and versatile information exchange. VREG leverages Vehicle Identification Numbers (VIN) to keep track of each vehicle in the country. This centralized database keeps a meticulous record of critical details, including specifications, ownership, and complete historical data for every vehicle in Nigeria.
Smugglers exploit hidden routes and unauthorized passages.
Vehicular data of all imported vehicles is efficiently stored and curated through the VREG platform’s connectivity with various global VIN databases and vehicle history repositories. VREG’s association with various stakeholders like NCS, NAICOM, VIO, CBN enable it to provide duty payment validation, vehicle ownership documentation, vehicle insurance validation, asset assessment for the moveable asset registry, and vehicle history reporting. Duty evasion stands as one of the major reasons behind the illicit practice of vehicle smuggling.
Numerous Nigerians attribute the mounting customs duty expenses as a primary motive fueling the choice of cheaper methods by car dealers to purchase and sell vehicles in the Nigerian market. Most times, smugglers exploit hidden routes and unauthorized passages to elude scrutiny and detection by the government authorities. Another alternative method involves disassembling the vehicles into individual components and subsequently conveying them in smaller fragments to traverse the border. The National Bureau of Statistics (NBS) data shows that Nigeria has steadily imported around 400,000 vehicles within the span of 2015 to 2020. A significant proportion of these vehicles, approximately 40 percent, are illicitly smuggled into the country on a yearly basis.
Government has intensified their efforts in recent years.
Nonetheless, the Nigerian administration has in recent years intensified their efforts to combat vehicle smuggling and introduced more stringent protocols to curb the practice. Months ago, the Nigeria Customs Service reported a successful interception of a vast collection of 100 automobiles. Among these vehicles were an array of Sport Utility Models, with 38 of them having been relinquished to the Federal Government. Customs Service also urged all stakeholders to collaborate closely with its officers and personnel in order to successfully combat the issue of illegal vehicle smuggling into the country.
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