A COUPLE of weeks ago, the cabinet amended the way road tax will be calculated, but rather than have lower carbon emissions as the policy objective, the amendment would make used cars much more expensive to run. It was a peculiar decision, the sole objective of which seems to be to protect the importers of new cars, as imported second-hand cars would be charged a higher road tax, based on when they were produced. A five-year-old, second-hand car imported to Cyprus would pay a high road tax, regardless of its carbon emissions.
The Cyprus Car Importers Association (Pasea) said the government amendments were not anti-pollution nor did they promote environmental protection. All they would achieve would be to make the road tax on second-hand cars unaffordable as road tax for a 1400cc, second-hand car would increase from €80-90 per year to anything between €300 and €600. The association has a point, because an imported second-hand with the same carbon emissions as a brand new car of the same engine power would pay anything between three and six times as much road tax, depending on its age.
Importers of new cars would be the sole beneficiaries of the decision said Pasea, claiming that the average consumer would be shut out of the car market. This might be an exaggeration, but it does not make the decision any more justifiable. In a way, the big tax on second-hand cars is in conflict with the decision to lower fuel consumption tax, which it was argued would benefit low income families as it would make petrol cheaper. Cheaper petrol was necessary given the poor public transport, said one deputy. But do not low income families have a right to a lower-priced car given the poor public transport?
These contradictions indicate there is no real government policy to lower carbon emissions and protect the environment. For instance, the higher road tax will not be imposed on a car already in circulation, even if its carbon emissions were high. This would suggest that the primary concern was to force people to buy new cars by making the road tax for imported, second-hand cars unaffordable. It is a slapdash policy that will make it more difficult for people on low incomes to buy a relatively decent second-hand car, while doing little to reduce pollution, raising serious questions about the reasoning behind it.
The second hand car dealers have pledged to fight the amendment and we are certain there will be no shortage of deputies that will back them, and they will be correct to do so.