THE Alliance For Change (AFC) has promised to simplify and reform the tax regime on motor vehicles, halving the taxes on new imported ones if elected to office on November 28. Making the promise while addressing the media at the Party’s Campaign Office in Campbelville, Georgetown, member Robert Badal yesterday expressed the view that it will augur well for the ordinary Guyanese as well as boost Government revenue.
“This will stimulate demand for new vehicles away from old vehicles and raise Government revenue higher while at the same time making ownership more affordable,” he argued.
In his view, to buy a vehicle is like giving Government two such in some cases, as he pointed out that a Rav 4 that costs $5.8M carries a tax of $9M, an SUV(Prado) that cost $9.6M involves $20M tax, a Toyota Corolla that cost $4M attracts $4M tax while $18M tax is payable on a Camry costing $8M.
“Nobody buys a new vehicle and pays the correct taxes, therefore, the objective of the Government is not really one of revenue maximisation,” the businessman contended
His argument is: “While a new vehicle attracts the highest of taxes, less taxes are levied on vehicles older than four years. The result is that Guyana has become a graveyard for used vehicles, the majority of which are imported at 10 years old.”
Badal compared this rate to those of other Caribbean countries and concluded that the level of taxation in Guyana is significantly higher than other States as in the case of Trinidad and Tobago.
In addition to cutting the tax on new vehicles by half, he said the AFC is proposing that approved taxi and minibus operators will only pay 10 per cent on the cost, insurance and freight (CIF) value.
Badal, who owns Pegasus Hotel among other businesses, said the AFC is confident this new policy he outlined, if implemented, could cut corruption in public office.
He said the party also believes that this and its other tax cuts are sustainable if corruption is reduced and more efficient Government spending is done.
Badal said an AFC economic policy sees a reduction in the Value Added Tax (VAT) and the personal income tax and a 20 per cent increase in public servants’ salaries.