Industry urges govt. to cut tax anomalies on new vehicles
Industry experts have called on the government to tax brand new vehicles on the car manufacturers’ price.
“We’re making representations to the Treasury on this. We don’t agree with the current way of taxing brand new cars,” Arthur Senanayake, Chairman IWS Holdings, a company dealing in luxury vehicles, told the Business Times.
The most ‘transparent’ way of taxing a vehicle is on the actual price of the car, he stated. “The brand new vehicles should be taxed on the manufacturers’ invoice,” he reiterated noting that this gives the true picture of the product cost. He added that if there’s evidence of any malpractices in this regard, the culprits should be taken to task and not penalise all importers on a blanket basis. However, he said that while the vehicles of European manufacturers’ aren’t taxed on invoices the government taxes on invoices of Indian, Malaysian and Korean manufacturers.
“Now we’re told that the state wants to tax the vehicles on the cost, insurance and freight (CIF) value of the UK website of the car manufacturers which shouldn’t be the case as vehicles in these sites have totally different options as opposed to standard cars,” he said adding that under invoicing was started by some car importers to take advantage of the US$ 30, 000 – 35, 000 ceiling on the CIF value government servants’ concessionary duty permits which has jeopardized the position of direct car importers.