Tax on Imported Used Cars May Prove Unpopular

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Used vehicles and private vehicle imports are once again in the spotlight. This time it is not relating to moonlighting unlicensed car dealers, but rather a Legislator’s view that used vehicles should be taxed.

The opinion that Government should tax used vehicles was made by Junior Minister for Tourism Hon. Archibald Christian during the 2018 Budget Debate. The Junior Minister told the House of Assembly: “A few businessmen in the Territory have spoken to me about various levels of duty that could be charged for second hand or imported vehicles. It is not a myth – we see an explosion of second hand vehicles in the Territory.”

There is no public transportation in the Territory and therefore persons mainly rely on private vehicles for moving around. Many motorists had their cars damaged by the hurricanes of last year and many vehicle owners cannot pay the often high repair costs. And if they do they still have a vehicle that to some degree has been “compromised” and can only generate further repair expenses. Individuals who cannot afford to purchase new vehicles from dealerships or lack funds to purchase second hand transports here in the Territory often opt to import lower priced vehicles. Many motorists feel that imposing an unheard of tax on second hand imported vehicles is a very unpopular way “especially now” to tell local car dealers they have a monopoly.

However, the Junior Minister told his colleagues: “There are persons that may not be able to purchase new ones so they have to purchase within their means, but a lot of those vehicles end up on the roadside as derelict vehicles. And it comes at a cost to the government to the tax payers of the Territory.”

Therefore, Hon. Christian suggested that government implements a tax: “If you are going to bring in a vehicle to the Territory that has a certain amount of mileage or a certain amount of age, we would levy a one-time fee on those vehicles so that in the event something happens to it, if it is left along the roadside it is removed at a cost that is not considered to be over and above what government would have paid to remove it,” he said.

 Moonlighting Dealers Eyed

Back in 2014 it was reported that the Financial Investigation Agency (FIA) was attempting to identify persons who are involved in the illegal buying and selling of vehicles in the Territory. The announcement was made by Mr. Errol George, the Director of the Financial Investigation Agency during his appearance before the Standing Finance Committee.

Mr. George told the Committee that his office was having problems with the automobile agents who were importing and selling vehicles without a licence to do so. The Director of the FIA announced that a number of persons went overseas, imported vehicles and sold them.

He said that established car dealers urged the FIA to look into the matter and apply monitoring across the board. However, Mr. George explained that it was difficult to identify persons who were travelling overseas and importing vehicles for sale.

As a result it was disclosed that the Agency intended to reach out to HM Customs for assistance in identify guilty persons. In fact, the Director stated that he has been engaged in ongoing collaboration with the Trade Department and the Department of Motor Vehicles; who provided some information. However it was stated that the information received was not enough to identify guilty persons.

It was further mentioned that there are a number of rental companies who are also involved in buying and selling vehicles even though they do not have a trade licence to do so.

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