𝐆𝐨𝐯𝐞𝐫𝐧𝐦𝐞𝐧𝐭 𝐄𝐲𝐞𝐬 𝐃𝐢𝐫𝐞𝐜𝐭 𝐅𝐨𝐫𝐞𝐢𝐠𝐧 𝐕𝐞𝐡𝐢𝐜𝐥𝐞 𝐏𝐮𝐫𝐜𝐡𝐚𝐬𝐞𝐬 𝐭𝐨 𝐀𝐝𝐝𝐫𝐞𝐬𝐬 𝐏𝐫𝐢𝐜𝐞 𝐒𝐮𝐫𝐠𝐞

…𝑷𝒂𝒓𝒍𝒊𝒂𝒎𝒆𝒏𝒕𝒂𝒓𝒚 𝑪𝒐𝒎𝒎𝒊𝒕𝒕𝒆𝒆 𝒂𝒏𝒅 𝒇𝒊𝒏𝒂𝒏𝒄𝒆 𝒃𝒐𝒅𝒊𝒆𝒔 𝒊𝒏𝒗𝒆𝒔𝒕𝒊𝒈𝒂𝒕𝒆 𝒃𝒚𝒑𝒂𝒔𝒔𝒊𝒏𝒈 𝒍𝒐𝒄𝒂𝒍 𝒂𝒈𝒆𝒏𝒕𝒔

By Kezang Choden

The Ministry of Finance has completed an analysis of the tax revision’s impact on vehicle prices, revealing significant trends following the lifting of the vehicle import moratorium in August. The study attributes the price hike to the previous government’s tax revision in 2022 and other market-related factors.

Although smaller family cars with engine capacities below 1200cc had unchanged tax rates such as the Alto under 1000cc, prices for these vehicles have risen. The increases are linked to factors beyond tax changes, including higher insurance costs, transportation fees, the addition of advanced features in newer models, and larger dealer profit margins.

Additionally, the Ministry examined whether vehicle dealers are levying excess taxes, which may have further contributed to rising costs. To address this issue, a Parliamentary Committee has initiated a study exploring alternative vehicle purchase options, such as direct purchases from foreign dealers.

The Royal Monetary Authority (RMA), in collaboration with the Department of Trade and the Ministry of Finance, is assessing whether enabling customers to bypass local agents could reduce costs. This would involve formalizing mechanisms for consumers to purchase directly from foreign dealers. The Prime Minister has directed the Ministry of Industry, Commerce, and Employment (MoICE) and the Ministry of Finance to evaluate the feasibility of this approach.

While there are no immediate plans to revise vehicle taxes, the Ministry anticipates a potential reduction in these taxes with the future introduction of the Goods and Services Tax (GST). This reform would shift tax collection from the point of sale to the point of entry, improving both efficiency and transparency in tax administration.