FG crashes Prices of New and Tokunbo Cars

Federal Government Reduces Import Levy on New Vehicles to 10%

The Federal Government has announced a reduction in the import levy on brand-new vehicles from 20 per cent to 10 per cent, while the levy on used (Tokunbo) vehicles has been cut from 15 per cent to 5 per cent as part of its 2026 fiscal policy measures aimed at easing the cost of vehicle imports and supporting economic activity. 

The directive, issued through the Ministry of Finance and implemented by the Nigeria Customs Service (NCS), takes effect from July 1, 2026. Authorities say the measure is intended to lower the cost of imported vehicles, improve affordability for consumers, and stimulate the automotive sector.

However, the government is simultaneously introducing a Green Tax Surcharge on imported vehicles with larger engines. Vehicles with engine capacities between 2,000cc and 3,999cc will attract a 2 per cent surcharge, while those with engines of 4,000cc and above will pay 4 per cent. The surcharge is designed to encourage the use of cleaner and more fuel-efficient vehicles while reducing carbon emissions.

The new green tax will not apply to electric vehicles (EVs), mass transit buses, locally manufactured vehicles, and tractors, which have been exempted to encourage local production, public transportation, and environmentally friendly mobility.

Economic analysts note that although the reduction in import levies could lower vehicle prices over time, the actual impact on the market will also depend on factors such as exchange rates, shipping costs, port charges, and dealer pricing. As a result, consumers may not experience immediate price reductions despite the government's policy changes.