The Federal Government of Nigeria has announced a significant reduction in Customs duties on imported vehicles, slashing rates by up to 50% while simultaneously introducing a new Green Tax Surcharge aimed at vehicles with large-capacity engines. The policy, which took effect ahead of the July 1 implementation of the green tax, is designed to cushion the environmental levy's impact while promoting cleaner transportation and easing the cost burden on importers.
Customs Duties Slashed by Half
According to a report by BusinessDay, the Nigeria Customs Service (NCS) confirmed that import duty on brand-new vehicles has been reduced from 20% to 10%, while duties on used vehicles, commonly known as Tokunbo, have been cut from 15% to 5%. The directive, announced on Monday, June 29, follows approval by the Federal Ministry of Finance and is expected to moderate the impact of the new environmental levy on affected vehicle categories.
New Green Tax Targets Large-Engine Vehicles
While import duties are falling, the government is introducing a Green Tax Surcharge on imported vehicles with larger engines as part of efforts to reduce carbon emissions. Vehicles with engine capacities between 2,000cc and 3,999cc will attract a 2% surcharge, while those with engines of 4,000cc and above will pay 4%. Abdullahi Maiwada, National Public Relations Officer of the Nigeria Customs Service, stated that the surcharge will not apply to electric vehicles, locally manufactured vehicles, or mass transit buses. Instead, it is aimed specifically at higher-emission vehicles with engine sizes exceeding 2,000cc.
Luxury SUVs and Sports Cars Most Affected
The new levy is expected to affect many popular luxury SUVs, pickups, and performance vehicles commonly imported into Nigeria. Models such as the Toyota Land Cruiser, Volvo XC90, Mercedes-Benz GLE, heavy-duty pickup trucks, and performance cars like the Porsche 911 and Honda Civic Type R fall within the affected engine-capacity range. Smaller passenger vehicles with engines below 2.0 litres will not be subject to the surcharge.
Part of Broader Tariff Reforms
The latest announcement builds on the government's earlier decision in April to reduce the overall tariff on fully built passenger vehicle imports from 70% to 40%. Despite the latest duty reductions, imported vehicles remain subject to several other charges, including the National Automotive Council levy, Value Added Tax (VAT), and other statutory fees depending on the origin of the vehicle.
According to Murtala Muazu, Comptroller in charge of Tariff, System Audit and Coordination at the NCS, the Green Tax Surcharge will operate separately from existing Customs charges and will be assessed through a dedicated mechanism integrated into the Harmonised System (HS) Code declaration platform. The Customs Service said sensitisation programmes are already underway across its zonal commands to prepare stakeholders for the new policy.
FG Releases Import Prohibition List
In related news, the Nigerian government has updated its list of items not allowed to be imported into the country, with cement, soaps, fertiliser, and 14 other goods and products on the list. The development was announced in a circular issued by the Ministry of Finance and signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, following presidential approval of the 2026 fiscal policy measures. The document, quoted in Punch, stated that the revised measures became effective from April 1, 2026, under the ECOWAS Common External Tariff guidelines.
