The government is reconsidering a ban on importing vehicles older than 12 years after the minister of finance admitted this policy may have merely driven up costs without achieving its intended purpose.
Finance minister Ericah Shafudah said this during an engagement with ‘order with me’ operators in Windhoek on Saturday.
Shafudah said the policy was introduced years ago after concerns from vehicle dealers that allowing large numbers of older vehicles into Namibia could affect local businesses.
She, however, said the policy may not have achieved its intended purpose.
“This policy did not stop these vehicles from entering the market,” she said.
The minister said the government is now questioning whether the policy has merely increased costs for consumers.
“We may have only made these vehicles more expensive instead of allowing them to come directly into the market,” she said.
Shafudah said many of the policies governing imports were developed before online shopping and small-scale import businesses became common.
Uzakuje Kamuvete, an operator who imports vehicles from Botswana for resale in Namibia, said inconsistent vehicle valuations at border posts create uncertainty for traders.
He said import duties are sometimes calculated using values that differ from the purchase price reflected on official documents.
Kamuvete recalled recently importing a vehicle from Botswana for 55 000 pula (about N$67 000).
“I had all the documents and receipts, but I was told the value of the vehicle was N$100 000 and that I would be charged based on that amount,” he said.
Kamuvete said many small businesses can only afford older vehicles, yet current regulations require many of those vehicles to first be registered and used in Botswana before they can be imported into Namibia.
Another operator, Koleni Shiyaka, said customs duties and value-added tax are placing pressure on emerging businesses.
“You would buy this car for a mere N$30 000, but the Namibia Revenue Agency (Namra) is uplifting this duty so much,” she said.
Shiyaka proposed a fixed valuation system for imported vehicles if customs officials do not accept purchase invoices.
She warned that delays in addressing the concerns could force some small businesses to close.
Current customs rules require informal traders to pay 10% customs duty and 16.5% value-added tax on imported goods, or alternatively a flat rate of 20% based on the value of the goods.
The Customs and Excise Act also provides a duty-free allowance of up to N$5 000 for qualifying travellers importing goods for personal use, while goods exceeding that amount attract a 20% flat rate.
Meanwhile, Namra commissioner Sam Shivute says the agency supports the growth of small businesses and wants trade to be facilitated.
“We want trade to be facilitated so we have more business people, and so they can scale up their businesses.”
He says there is a need to educate traders on how customs duties and taxes are calculated.
