New car dealers want import age limits rolled back
Published:Thursday | March 8, 2012 | 12:00 AM
Marcella Scarlett, Business Reporter
The Automobile Dealers Association (ADA) is proposing that the government consider rolling back the age limit for motor cars being imported to three years old and light commercial vehicles to four years.
Those are part of the recommendations made to a committee on tax reform and discussed in Parliament yesterday.
"The ADA is against the recent amendments to the motor vehicle import policy and recommends that the policy revert to the status of motor cars being restricted to three years of age and light commercial units be restricted to four years of age," according to the document.
The government amended the motor vehicle import policy effective December 1, 2011 to allow for the importation of motor cars up to five years old from three years, and light commercial vehicles up to six years old from four years.
The ADA, which represents new car dealers, reasoned that "importing older vehicles will increase the fleet age, decrease the fleet efficiency and decrease fleet reliability."
The Association also suggested that it "provides a false sense of economy and will result in lower revenue collections due to the well known framework of tax avoidance that accompanies increased direct imports and used car imports."
However, Lynvalle Hamilton, President of the Jamaica Used Car Dealer Association (JUDCA), said his association strongly disagree with this recommendation", countering that "there has been increased revenue collection as imports have increased by 20 per cent since December and taxes have increased proportionately."
Hamilton told the Financial Gleaner yesterday that the change in the age limit was a well needed stimulation for the motor vehicle industry as dealers were going out of business because they were too expensive for consumers.
"We had reached a point where we had stopped importing cars and those on the lots were just not moving, he explained.
The cars were just not affordable. Now people can get good cars at more affordable prices, he added.
According to Hamilton, "Jamaicans feel safer in the comfort of their own vehicles and what we are doing is making vehicles more affordable for them."
As it relates to monitoring the age of the existing fleet, Hamilton said the government needed to come up with solutions to deal with very old vehicles.
"You know we have vehicles driving on our roads that are 20 and 25 years old. If they don't make vehicles affordable people will continue to drive these old cars and there is not even any standard that we keep them to," said Hamilton.
The JUDCA president said the group plans to make its own set of tax reform recommendations, but they have not yet met to have discussions.