 As the controversy surrounded the introduction of 15% national automobile cancel levy on imported vehicles lingers, some maritime lawyers have demanded court intervention as a way of resolving their matter. Now, the Nigerian customs service had recently introduced a 15% NAAC levy on used imported vehicles, a decision which didn't go down well with Clarence agents in the country's maritime sector. The agents have argued that the NAAC levy is mostly meant for new vehicles, questioning the rationale behind the introduction of the duty on used vehicles. In a quick response, the service in a statement by the National Public Relations Officer, Timi Bomodi, said the move was in compliance with the economic community of West Africa common external tariff. Well, that's our focus on the show for today. Welcome to Business Insight and Plus TV Africa. I am Justin Abadouni. Before we get to the main discourse, let's bring you a highlight of major business stories which trended this week. Take a look. Telecommunication subscribers under the aegis of the National Association of Telecom subscribers have said they are set to drag the federal government to court in May in a bid to temporarily suspend the government's barring of subscribers' outgoing calls. On Monday, April 4, the federal government ordered telecom companies to bar outgoing calls on all lines that have yet to link their national identification number and the subscriber identity model. As a result of this, about 72.77 million active telecom subscribers were barred from making calls on their sims. In response to this, not firms urged the federal government to extend the implementation of the same NIN policy by three months. The association also gave the government one month to implement the ban. As controversy continues to surround the introduction of 15% National Automobile Commission levy imposed on important used vehicles by the Nigeria Custom Service, car dealers have threatened to close their stores this week. The NCA that recently introduced a 15% National Automobile Commission levy on used imported vehicles, a decision which didn't go down well with clearing agents in the country's maritime sector. The agents argue that the NAC levy is mostly meant for new vehicles, questioning the rationale behind the introduction of the duty on used vehicles. In a quick response, the service, in a statement by the National Public Relations Officer, Timi Bomodi, said the move was in compliance with the economy community of West African Common External Tariff. The World Bank says increasing fuel subsidy puts the Nigerian economy at a high risk as subsidy payments could significantly impact public finance and pose debt sustainability concerns. The Washington-based lender said this in a new bi-annual report known as Africa's Pulse. According to the Bank, Nigeria is projected to have a 3.8% growth in 2022, adding that as an all-dependent country, weak oil production amplifies economic recovery. Despite other that increasing fuel subsidy poses a high risk to the country's economic growth despite the increase in oil prices. The National Bureau of Statistics, NBS, says about 30 million passengers travelled through Nigerian airport in 2021. The figure represented growth rate of 43.41% from 9 million recorded in 2020. The NBS disclosed this in its recent Air Transportation report for 2021 released on Wednesday. According to the report, the total number of arrivals in 2021 stood at 6.5 million, which was higher compared to the 4.9 million recorded in 2020. And those were the stories that made headlights in the world of business for this week. Now, partner and co-founder VIM Professional Solutions and of course the MD of Umwahi Associates, Magnus Mwong, joined us now to share insight on this issue. Thanks for joining us, Magnus. Thank you very much. All right, now maritime stakeholders, especially Clarion agents, have described the new policy as an illegality, explaining that it contravenes the nation's Finance Act. What does the Finance Act say about this? So one of the things we've also done as a business on this side is that we've monitored the Finance Act over the last three years. I mean, the first Finance Act was released, was made available in public in 2020, which is the Finance Act 2019 and from 2020 to date, we've had yearly editions of the Finance Act. And I dare say, having reviewed all of this act, there's nothing that talks about clearly this national automobile commission levy. So it's a lot of controversy at the time, and we probably need to be calling out on the Minister of Finance to give a proper clarification on what this implies. So chances are that there might be some publication or some notification by the government in connection in partnership with the Nigerian Custom Service to issue such a legislation, but it's not contained in any of the Finance Act that has recently made news. So we're looking at the 2020, which is the Finance Act 2019. We're looking at the 2021, which is the Finance Act 2020, and the very recent one, which is 2022, the Finance Act 2021. There is nothing in any of those acts that talks about national automobile commission levy of 15%. So those are my views as the end of my associate. But, and I know governments couple of times bringing certain legislations to mitigate or manage the buying attitude of its citizenry. So chances are that this is one of such things. So if the lawyers, the baristas in the automobile industry are saying that this contraband the Finance Act, then maybe this gives credence to their position. All right, let's take this one step further now, Magnus. The clearing agents and dealers have argued that the NAAC levy is an attempt by customs to arm-twist importers in order to meet their yearly revenue target of $3 trillion now for the year 2022. What do you make of this? So if anything we've said before is something to hold water with and the various societies and groups and organizations that are coming up to challenge the position of this levy, something to hold onto, then there may be a smoke somewhere there. To say perhaps because government is also trying to increase its internally generated revenue, they are also looking at ways of trying to get such funds because like you know, impotention of vehicle is also a key factor in this part of the world. So chances are that the clearing agents may have some smoke that they are stoking in that regard. All right, now the stakeholders are also arguing that the NAAC levy was supposed to be uncollected. Let me take that question again, sorry. Now the stakeholders have argued that the NAAC levy was supposed to be collected on new vehicle imports at 35% to encourage local vehicle manufacturers and industries in the country. Can you break this down for us? So what we have currently is the impotention of new vehicles, depending on the age of the new vehicle and then depending on the make, there is a levy for it, for new vehicle. There is a given levy that you have to pay, then in addition with the national, with the automotive levy, NAAC levy. But for used vehicle, there is a 20% custom duty you need to pay and in addition with the 15% levy. So the clearing agents are arguing that a combined 35% of this levy on used vehicle will, it's too much, considering all of the economic effects going on in the country at the moment. Okay, so just what, in other ways now, let's look at this critically. Just what is the implication of this new development on Nigerians? So the implication is that we begin to see a lot more increase in vehicle as someone who's also involved in the impotention of used vehicle into the country and knocked down vehicles by way of parts. Cost of buying these vehicles have increased because of course, the FX has a lot to play in this industry as well. So your cost, you bring in your vehicle, you bring in your goods into Nigeria, you sell in Naira and by the time you sell, you need to convert that funds back to US dollar to be able to, or foreign currency to be able to import these vehicles into the country. So you begin to see certain bottlenecks along the way. So there is the FX one, there is the increase in duties that you need to pay, which is now put at 35% except if the customs and the Ministry of Finance tend to reduce that. What we tend to see is that the cost of vehicles are going to go up, cost of transportation are going to go up and it's going to have multiplier effect down the road. So even if you don't have a very, and you need to go show up what a client means in looking, looking to use, you probably will be ordering an Uber or a boat service or any of those other types of transportation. The cost of buying those vehicles in that line of business is going to go up and for the owners of those business to be cool, they're going to have to pass on that work to the ultimate consumer. So what we see play out in the next couple of months or into a 12 month period, which is one year, is that the cost of buying vehicles, cost of transportation, cost of going from one place to another is going to go up. OK, fine. There's a whole lot of talk that has surrounded this new development. But do you agree that by slamming this 15% NAC levy the government was simply forcing people to tilt towards patronising local manufacturers? Well, the school of thought would argue that how many local manufacturers we have and how do we block those vehicles? Do you want to spend about 10 million Nair buying a vehicle? And in two or three years down the line, we're looking like you've not even started up anything. And the cost of making 10 million Nair these days is not what it was five years ago. So while I would also encourage that government putting policies and policies in place that will support local manufacturers, they can clearly put in place certain policies to mitigate those of us who tend to buy used vehicles. So I agree we may tend to begin to look at home-grown vehicles for our commuting, but we need to try as much as possible to make those vehicles a lot more durable. Because if you look at buying a used vehicle, say Toyota Corolla today in 2012 Corolla or in 2012 Toyota Camry, you can use that vehicle comfortably for another six to 10 years if you have good maintenance culture. But if you pick up a brand new locally manufactured vehicle, can you actually use it on Nigerian roads for the next five years without looking like it's been battered? So we need to put all of this in concentration so that we can begin to encourage home-grown manufactured vehicles. So in your opinion now, would you say that governments and policies have not actually encouraged local manufacturers of vehicles in the country? Yes and no. Yes, in the sense that when you begin to look at cost of running, cost of testing in Nigeria, cost of running diesel, those are signals that our policies are not given towards encouraging local manufacturing. And if you go further to look at infrastructure, the road network and all the connectivity from one point to another and a number of other factors, you see that those are not there. All right, we still have Magnus Amonwa on the show. We'll take a quick break and return with more. Do join us again. Welcome back. It's still business in site and plus TV Africa. And we still have Magnus Amonwa with us. And we are looking at the NAC, the 15% for vehicles that have been imposed. But right now, let's just take it one step further and just do a bit of a critique of the finance act and how it has actually helped in revenue generation for the country. Thank you so much, Amonwa, for standing by. Yeah, thank you. All right, let's just talk about the finance act that is actually enforced in the country. And Nigeria has over time talked about revenue generation and how they can diversify the economy. How would you rate the finance act, the recent one, and what contribution has it really done to the nation's revenue generation? So before 2020, it's typically time to wait for a minimum of five years or thereabout before we can make certain legislative changes. But what we see happen with the introduction of the finance act is that it's looking like an unlawful. So over the last three years, we've had different amendments to certain legislations in the country. And the potential that the finance act leads is that it's issued and it's signed and it's made available to the general public simultaneously with the project of the federal government for that year. So the finance act is geared, it's a mechanism geared towards helping the federal government with its vision to raise the necessary internally generated funds with which it can execute its project. And over the last three years, it's steadily progressed like we've seen. A number of things have been there. They've encouraged the growth of small businesses in the first finance act when it changed the threshold of the categories of small businesses that can pay taxes and what needs to be paid. So there's a bit of clarity. It's becoming a lot more flexible. It's becoming a lot more interactive. So if government sees that a certain portion of the legislation is not yielding its fruits, they are able to change it in the following year and make necessary amendments. And the beauty as well is that it's not just government sitting down and designing the finance act, the citizenry, key stakeholders, business decision makers, a lot of consultation that go in. So it's citizens like you and I who are pulled together into a group that sit down, discuss, deliberate their discussions in various sectors and geopolitical zones of the country to agree as to what makes or what should be in the next finance act. So it's a work on development, but we're yet to begin to see a lot more of this play, especially in the engine room, which is the small and medium businesses. We would like to see a lot more traction with government trying to ensure that those who they require to pay tax or pay certain levies, and when they do have certain people or certain infrastructures to keep running their businesses. All right, thank you so much. We have been speaking with the Magnus Omoa and he has been sharing useful insight on all of this recent issues and that have generated a controversy. Magnus is the MD Omoa here associates. Thank you so much for your time. Thank you very much. All right, it is still business insight and plus TV Africa will now leave you with useful tips on how to write an informal proposal, but that's the size of the show for this week. I am Justin Acadone. Many thanks for watching. Writing an informal proposal. The thoughts of writing a proposal overwhelms many people, but the task does not have to be daunting. Informal proposals are written when people need to ask permission to make a purchase, undertake a project or write a paper. This type of proposal is a way of persuasively putting forth an idea and asking for action to be taken on that idea. When writing a proposal, consider who will read the proposal and what that person may or may not already know about what you are proposing. Follow these steps when writing a proposal. One, state your purpose. Do this clearly and concisely so that the reader knows immediately why you are writing. Two, give some background information. Explain why you are proposing your suggestion so that the reader has a better understanding of the problem. Three, state a solution to the problem. This is where you give specifics about your suggestion. Four, show costs. Lay out any costs that will be involved. Five, conclusion. Wrap it up by restating the problem and the proposed solution.