Government has announced its intention to increase sweeping reforms the tax sector which include the removal of excise tax on new vehicles that are under 4 years old.
This was announced by Finance Minister Winston Jordan in his 2016 Budget Speech.
According to the Minister, persons importing vehicle under 4 years old and under 1500cc will no longer be required to pay the excise tax.
“These vehicles currently attract excise tax at the rate of 30% and an effective tax rate of 118.7%. With this removal, the effective tax rate will be reduced to 68.2%,” said Jordan.
In addition there will be a reduction of excise tax from 50% to 10% on motor vehicles under four years old, between 1500cc and under 2000cc.
As a result, the effective tax rate of 152.3% will be reduced to 85%.
Jordan also announced the “restriction of the importation of used and/or re-conditioned vehicles to under 8 years old from the date of manufacture to the date of importation. This restriction shall be enforced from May 1, 2016.”
He also gave notice of the Government’s intention ban the importation of used tyres and to reduce taxes on new tyres to encourage their use.
“This ban will be put into effect as soon as some procedural hurdles are cleared,” Jordan stated.