Customs cracks down contraband cars


The Ethiopian Customs Commission is seizing untaxed vehicles that have come into the country illegally via Somalia and Djibouti. So far over 450 different vehicles have been confiscated in the ongoing operation.
During the crackdown, close to 150 Toyota RAV 4, over 300 Toyota Corollas and other models of vehicles were repossessed from the streets of Addis.
Apparently, the vehicles first obtain fake documents and a plate number from Oromia Region. Almost all the confiscated vehicles had Oromia plates and documents before being transferred to Addis Ababa for sale.
Organized crime appears to be involved all the way from the Somalia and Djibouti border to the Oromia region and finally the capital where they are sold by car dealers.
For the Toyota RAV 4 model cars which have an estimated cost of 2.2 million birr, they offer a discount of up to 400,000 birr.
The confiscated cars are not limited to the two models, there are others but those models are the primary ones. The criminals work as a team and choose the cars with the highest re-sale value.
Capital asked the custom commission to comment but they did not reply. The officer from the commission said that the vehicles will not be released unless they pay the required taxes.
In Ethiopia unless exempted by law, items imported in to the country are subject to a number of taxes. However, the illegal trade in smuggled cars deprives the government of tax revenue.
Vehicle affordability is further locked up by prohibitively high vehicle taxes in Ethiopia, sometimes more than 220 percent depending on engine size.
Furthermore, the stages involved in registering a Duty-free Vehicle in Ethiopia is not far different from importing a new private vehicle, the only difference is in the payment of government tax, in that the Duty-free vehicle is not required to pay government taxes whereas the private new vehicle owner pays taxes.
The Ministry of Revenue says both commercial and private vehicles imported into the country can be subjected to five different types of taxes. However, despite the heavy tax burden there is a rise in the numbers of car imports ever year up to 50 percent.