Duty-free on motor vehicle comes to an end

The practice of waiving the duty and other applicable taxes on the importation into
the country of both new and used vehicles has come to an end.
At its meeting on Wednesday, the Cabinet arrived at a decision on a new policy
that effectively ends the practice that has been ongoing for many years.
“Cabinet affirmed its decision to discontinue discretionary waivers on the
forgiveness of Duty, ABST, Revenue Recovery Charge (RRC), and Environmental
Levy on the importation of used vehicles and the sale of new vehicles,” Cabinet
sources indicated.
According to the sources the decision was influenced by a report prepared by the
Customs and Excise Department on Revenue Collection in 2023, which showed
that discretionary waivers exceeded the deficit amount which the government was
financing by borrowing.
“The discontinuation of the waivers is premised on filling the gap between
revenues and expenditure, which must be undertaken to reduce the borrowings by
the government,” the sources emphasized.
Each year, several hundred used motor vehicles are imported from Japan and other
places on the expectation that the owners will not pay the full duty, ABST, RRC
and other taxes that are payable on these imports.
The move reflects a concerted effort by the government to bring expenditures in
line with government’s revenues thus reducing the need to borrow by the
government to meet its financial obligations.