To support its efforts at ‘greening’ the economy and protecting the environment, government yesterday announced plans to scale back the excise tax on vehicles that are under four years old, while restricting importation of used and re-conditioned vehicles under eight years old and banning importation of used tyres altogether.
Finance Minister Winston Jordan made the announcement during his presentation on the government’s proposed $230 billion budget for 2016, the theme of which is ‘Stimulating Growth, Restoring Confidence: The Good Life Beckons.’
Jordan said government will move to remove the excise tax on vehicles under four years old and under 1,500cc. He said these vehicles currently attract excise tax at the rate of 30% and an effective tax rate of 118.7%. With the removal of the tax, he said the effective tax rate will be reduced to 68.2%.
Government also plans to reduce the excise tax on vehicles under four years old, and between 1,500cc and under 2,000cc, from 50% to 10%. As a result, Jordan said the effective tax rate of 152.3% will be reduced to 85%.
Additionally, Jordan said, from May 1, the government will enforce the restriction of the importation of used and/or re-conditioned vehicles under 8 years old from the date of manufacture to the date of importation.
He also gave notice of government’s intention to ban the importation of used tyres and to reduce taxes on new tyres to encourage their use. He said this ban will be put into effect as soon as some procedural hurdles are cleared.
The government has implemented a ban on Styrofoam, which took effect at the start of the year. There has been some criticism by food industry operators, who have said biodegradable alternatives have proven costly. It is against this background that Jordan announced that there will be an amendment to the Customs Act to exempt all biodegradable containers used in the packaging of food and beverages.
Jordan said too that the government will also begin consultations for the re-introduction of a broad-based, non-discriminatory environmental tax.
