Both foreign-used and new-car dealers are expecting vehicle sales to slump significantly this year.
The new taxes on hybrid and electric cars took effect last month, driving up the prices for these vehicles.
Guardian Media understands the new taxes on Roll-on Roll-off vehicles amount to about 40 per cent. For instance, the basic version of a foreign-used Honda Vezel will now cost around $210,000.
Up to December 2020, it was priced at $170,000, however, added to the cost now will be; 20 per cent Import Duty amounting to $30,000, Motor Vehicle Tax estimating $5,587 and 12.5 per cent Value Added Tax amounting to $23,198.
President of the Trinidad and Tobago Automotive Dealers Association, Visham Babwah, told Guardian Media there was a “mad rush” for hybrid and electric cars since the new taxes were announced during last October’s budget presentation until the end of December as many people tried to dodge the higher prices.
“I think persons who have stock in hand that have spillover from last year should not increase their prices because the new tax will not apply”, he said.
Babwah stated as far as he is aware none of his members, who are all foreign-used car dealers, have not been engaging in price gouging.
He explained, “If persons have new stock that was cleared on or after the 1st of January 2021, those vehicles will attract the new tax and the prices would have increased. Because of the announcement last year in the budget, we were not allowed to clear cars like 4-year-old cars, so in January of this year I think most dealers’ stocks would have been depleted”.
“To be fair to everyone, persons don’t have big licenses. We are struggling in terms of the U-S dollars to import cars so a lot of dealers would have had very small stock in hand which would have sold out because to the end of last year,” he added.
Meanwhile, the Automotive Dealers Association of Trinidad and Tobago, which represents new-car dealers, told Guardian Media their members also had an influx of customers at the end of last year. The Association said it expects the demand for hybrid vehicles to decline since the taxes have made these units 20 per cent more expensive on their end. Even for other types of vehicles, the association said it anticipates a significant drop in sales this year.