Mr Kwasi Agyeman Busia, CEO, DVLA

Vexation greets luxury tax implementation

Kester Aburam Korankye Business News Aug - 14 - 2018 , 10:09

Anger and rejection have greeted the implementation of the levy imposed on vehicles with high engine capacities.

Some of the car owners are complaining that the targeting of contributors was misplaced.

The GRAPHIC BUSINESS observed at two separate private garages mandated to test and issue roadworthy certificates to vehicles that although vehicle owners were complying with the tax requirement, they were only doing so to avoid legal actions against them.

One such car owner, Mr Reginald Owusu, who had visited the Achimota Driver and Vehicle Licensing Authority (DVLA) centre on August 6 to renew the roadworthy certificate of his 1999 Ford Expedition told the paper that, “ I think the targeting of who pays this levy is misplaced”.

He explained that his old vehicle, which was almost out of shape, could not be classified as a luxury car and added that the government should have limited the imposition of the levy on newly imported vehicles with such high capacity engines.

When asked why the levy was misplaced, he said while pointing to his 1999 Ford Expedition that, “I don’t know how one can classify this car as a luxury car, what is luxury about it?” he queried.

In a separate interview with a car dealer, Mr Fiifi Komson, who is familiar with the registration of vehicles in the country at the DVLA office at 37 near the Ghana Police Church in Accra he said the new levy would be a drain on the pockets of car owners.

He said the few owners of vehicles with high engine capacities he had encountered were unhappy about the levy but were forced to comply with the law.

“People have no option than to pay, there was no consensus and people are not happy about the tax but we are looking at the coming weeks to see the reaction from the government because so far people are not happy about it,” he said.

Vehicle dealers to demonstrate

Meanwhile, the Vehicle and Assets Dealers Association of Ghana on August 1 served notice that it would soon demonstrate against the implementation of the tax.
President of the association, Mr Eric Kweku Boateng, told the media at a briefing that the tax was “insensitive” and would “affect our businesses negatively”.

New luxury levy

The implementation of the luxury vehicle law commenced August 1 after Parliament passed it to impose an annual levy on vehicles with high engine capacities after it was proposed by the government in the mid-year budget review on July 19.

With the approval of the legislators for its implementation, vehicles with engine capacity of 2950 to 3549 Cubic Centimetres were required to pay a levy of GH¢1,000, while those with engines between 3,550 to 4049 cubic centimetres would pay GH¢1,500.

Vehicles with engine capacities above 4049cc were also obliged to pay GH¢2,000.

The levy would be paid by the vehicle owner on the registration of the vehicle and subsequently on or before the annual renewal of the roadworthy certificate each year to the DVLA, the body authorised by law to collect the levy on behalf of the government.

Although the levy has been imposed on vehicles with the listed cubic centimetres existing prior to the passage of the law, exempt from the levy are vehicles such as tractors; ambulances; commercial vehicles that have the capacity to transport more than 10 persons, commercial vehicles for the transport of goods among others. —