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New pickup tax gets the thumbs down

Friday, June 08, 2012    

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KENT LaCroix, chairman of the Automobile Dealers Association (ADA), believes Jamaica's productive sector will be hard hit with the June 1 hike in the Common External Tariff (CET) duty imposed on pickups.

Recently, as part of an effort to raise an additional $19.3b in new taxes, the Government increased the import duty on motor-vehicle imports over 2,000cc from 20 to 30 per cent. The duty is, however, also applicable to all pickups while trucks, panel vans, and buses are exempted from the increase.

Pick-ups fall in three general categories: up to 1,850 kg; over 1,850 to 2,200 kg; and, over 2,200 kg.

LaCroix said while his new-car import umbrella group is unopposed to paying taxes, he, however, feels pickups were "unfairly" singled out.

"The CET on all pick-ups — whether two- or four-wheel drive — regardless of the cc ratings, has been increased from 20 per cent to 30 per cent," LaCroix told Auto. "And CET is the first part of the duty. All other taxes are then added."

He said the productive sector would be greatly affected by this move.

"Pickups are the work horses of the productive sector and the end consumers would have to bear the brunt of the taxes," he said.

Lynvalle Hamilton, president of the Jamaica Used Car Dealers Association (JUDCA), said he has not yet seen any official document with regards to the duty hike on pickups. He, however, shares the view that such a move would definitely have a negative impact on the productive sector.

"If the increase in duties also apply to pickups, this would be a big blow to several of Jamaica's industries which depend on these vehicles," he said. "Pickups are very expensive vehicles, and we [JUDCA] thought the government would have reduced the tax to help generate sales... hence more revenue for them."

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