National Treasury said there is no question about a deferral for the introduction of a “green tax” on new imported vehicles.

The tax comes into operation on 1 March. According to the structure which will become effective in March, the ad valorem duty on a vehicle with a R300 000 retail price drops from 6.5% to 3.8%, for a R200 000 vehicle from 4.1% to 2.2%, and for one worth R150 000 from 2.9% to 1.4%.

The duty on a vehicle with a R1m retail price comes down from 20% to 15% and a R1.3m vehicle’s import duty remains 20%.

The supplementary “luxury tax” will be levied at the rate of 8% on a new vehicle spewing greenhouse gas at a rate of 240 grams per kilometre, 10.7% on 280 grams and 12% on 300 grams.

Vehicles with greenhouse gas emissions of under 120 grams per kilometre will be exempt from the tax.

Commenting on the looming tax levy, the director of the National Association of Automobile Manufacturers of SA (Naamsa), said this tax could send the motor industry, which is gradually emerging from the downturn, back into recession.

The big unhappiness is the fact that the fuel sold in South Africa does not comply with the new technological requirements necessary to avoid the green tax.

Importers are aware of this shortcoming in South Africa’s fuel and subsequently do not fit the vehicles with the latest technology.

Source:, 20100117

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