The green taxes update will come into effect on August 1, 2013, and the prices of most popular cars will rise by 1.5-3%, depending on the model. On Tuesday, the Ministry of Transport published the official procedure, which also states that the old green tax levels will continue to apply on cars in port or in bonded warehouses on August 1 will continue to have the old green taxes through October 1. This means that most importers will offer cars held in inventory until the supply runs out.
The green taxes directive's final version is a compromise with the Ministry of Environmental Protection. It states that the green taxes formula will be updated once a year beginning in 2015, instead of 2014, as the Tax Authority originally planned.
Industry sources believe that most car importers will publish new price lists on August 1, to reflect the lower tax breaks and higher prices on popular car models. The price of a 1.6-liter sedan will likely rise from NIS 126,000-128,000 to just under NIS 130,000. Importers and carmakers will probably absorb part of the price hike.
The use value of company cars will also rise with the new price list, but this will only come into effect in the price lists of January 2014.
The green taxes update will generate NIS 400-600 million in annual tax revenues.
The fate of the luxury car tax in the state budget bill is still undecided. This tax is intended to balance, at least for the sake of image, the rise in prices of popular cars.
Meanwhile, importers are continuing sales. Seat importer Champion Motors Ltd. today announced introductory prices for the first 1,000 Seat Toledo cars to be sold. This model, which corresponds to the Skoda Rapid, will have a 1.4-liter engine and DSG gearbox, will be sold for NIS 108,900 for the accessorized model, NIS 10,000 less than the official price list. The manual version will be sold for NIS 99,900.
Published by Globes [online], Israel business news - www.globes-online.com - on July 10, 2013
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