Stimulus package for Jamaican auto dealers
Thursday, September 10th, 2009This has been an interesting week for motorists in Jamaica, but then again being a motorist in Jamaica is always interested. On September 9, 2009, the Government of Jamaica announced a 6 month stimulus package for the auto industries in Jamaica.
On the back on a 60% fall in sales, new and used car dealers apparently lobbied the government for some relief and alas got it. The government is strapped for cash so anything is better than zero and with fall-off in sales it meant less revenue for the government pockets.
The details
For motor vehicles 1000-1600 cc, the SCT of 10% becomes 0%. The results it that the overall markup do to SCT and GCT will decline about 25% from 82% to 63%.
Vehicles under 1000 cc already of 0% SCT while high-end vehicles will see SCT reduced from 70% to 35%. In between SCT for 1600 to 2000 cc moves from 20% to 5%, and for 2000cc to 3000cc vehicles the change is from 35% to 15% resulting in aggregate reduction in taxes from 110% to 77% and 128% to 96%
As usual there are some interesting footnotes. Those eligible for the 20% duty concession can now import vehicles with any allowed cc rating as the previous restriction to this category has been removed. However the ceiling on the value of the vehicle of US$25,000 remains.
My thoughts are, this should not be bad move but there are concerns. Will person exploit this to bring more gas guzzlers into the island? What about our Oil bill and our foreign exchange problem or do we have one?
The Portmore and other Toll users are looking for a Stimulus Plan.
n.b. Gas Prices from the refinery went down this week.
Sources