Used cars importation ban takes effect – despite strong objections from stakeholders

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Despite strong objections from almost all quarters of society, including the Private Sector Commission (PSC), the local used car dealers and the political Opposition, the Government-imposed ban on importation of used vehicles eight years and older from the date of manufacture to the date of importation took effect on Sunday May 1, 2016.

The highly-unpopular measure was announced by Finance Minister Winston Jordan during the presentation of the 2016 National Budget in January, which he said was part of the A Partnership for National Unity/Alliance For Change (APNU/AFC) Government’s programme of ‘greening’ the economy and protecting the environment.

carThe ban, seen by many as anti-poor and anti-business, covers cars, vans, buses, Sports Utility Vehicles (SUVs), and pickups. This ban is not applicable to vehicles used in the manufacturing or agricultural sectors.

The Government in the same vein had moved to remove the taxes on vehicles less than four years old as a cushion.

The excise tax on 1500cc vehicles less than four years old was removed, while there was a 50 per cent reduction of the excise tax to 10 per cent on vehicles less than four years old between 1500cc and 2000cc.

But, based on Japanese used car website www.tradecarview.com a 2011 Toyota Allion which costs approximately $4.7 million without taxes, to be shipped to Guyana and with a tax of 68.2 per cent as is outlined by the Government, would cost approximately $7.9 million in total.

A used Toyota Allion 2007/2008 was being sold here for approximately $3.2 million. This ban makes it virtually impossible for a significant part of the Guyanese population to own a vehicle, and will significantly affect the multi-billion-dollar used car industry.  It is because of these reasons the proposal was met with stern objections from a number of stakeholders.

When the announcement was made of the ban, several auto dealers had expressed the view that it will only benefit the upper-middle class and described the move as “jumbie economics” being implemented at a time when the Guyanese economy was struggling to “keep its head above water”.

The Guyana Auto Dealers Association (GADA) had also called on Government to put a hold on the implementation of the decision and hold consultations with key stakeholders.

The PSC had urged Government to rescind the decision which it said would only bring undue hardship to poor Guyanese.

Leader of the Opposition, Bharrat Jagdeo had also condemned the move which he said would completely deny the poorer class of Guyanese from enjoying the luxury of owning a vehicle. However, President David Granger had subsequently defended the decision, stating that the measure was in the best interest of the country. (Guyana Times)

 

 

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