Import duty reduced, licence fee removed for electric vehicles

The import duty on electric vehicles has been reduced from 30 per cent to 10 per cent and purchasers will not have to pay motor vehicle licence fees over the next five years.

This was made possible when the House of Representatives on Tuesday approved the Customs Tariff (Revision) (Amendment) (No. 2), Resolution, 2022, and the Road Traffic (Licence Duties) Order, 2022, and Resolution to give effect to the measures.

Minister of Finance and the Public Service, Dr Nigel Clarke, informed that the lower duty rates and the elimination of the fee requirement apply to electric vehicles that are three years old or less at the time of importation.

He said that the measures, which took effect on July 14, are supporting Jamaica's transition from a high dependence on petroleum for motor vehicles by making it more affordable for Jamaicans to acquire electric vehicles.

He said that the Government is serious about ensuring a clean energy future.

“The electric vehicle technologies are undergoing rapid change, and so the public interest is best served by ensuring that the latest technologies are preferred over older technologies. Having 10-year-old electric vehicles in the country doesn't help anybody; we need the latest electric vehicles at any point in time,” Clark contended.

The finance minister told the House that the implementation of the measures came out of discussions with the Ministry of Science, Energy and Technology, the Inter-American Development Bank (IDB) and other stakeholders to see how best to encourage Jamaicans to purchase electric vehicles.

He said it was determined that the reduction in duty and removal of licence fees would be the best way to incentivise the transition.

Clarke noted that duties on motor vehicles are a major source of government revenue, with earnings of about $30 billion to $40 billion, and so “the way we treat with the reduction of duties for electric vehicles has to be considered very carefully because we couldn't afford to completely cannibalise all of that revenue. However, at the same time, we must make a start in the transition.

“We recognise that these are not panaceas, but they represent a significant concession to facilitate Jamaicans in the acquisition of battery electric vehicles,” he added.

- JIS News

Follow The Gleaner on Twitter and Instagram @JamaicaGleaner and on Facebook @GleanerJamaica. Send us a message on WhatsApp at 1-876-499-0169 or email us at onlinefeedback@gleanerjm.com or editors@gleanerjm.com.