( L - R ) Walker, Shaw, Jackson

A leading used-car dealer has called for the lowering of import tariffs on vehicles, proposing instead that the Government recoup lost revenue in higher licences fees over the life of the car.

But Andrew Jackson, the principal of Jetcon Corporation, doesn't necessarily have the support of the Jamaica Used Car Dealers Association (JUCDA), whose president, Kenneth Shaw, said such a scheme could be burdensome to consumers.

"It might be unfair to ask an individual to pay $30,000, $40,000 or $50,000 to license a car every year, rather than making a one-time payment," Shaw told the Financial Gleaner.

"What I would support is that the older the vehicle gets, the more taxes should be paid," he said. "

Import tariffs on motor vehicles, notwithstanding a six-month rebate on some tariffs announced by the Government recently, can reach upwards of 200 per cent. And Jackson, a one-time head of the JUCDA, has long been a proponent of reform.

"Motor cars are severely overtaxed," he lamented recently. "When you tax the acquisition (of a vehicle), the person purchasing this asset has to insure both the asset, as well as the tax that was imposed by Customs. It is better to actually shift the burden of ownership from acquisition to usage."

Said Jackson: "The Government can take the tax from the car owner gradually over a five- to six-year period through an increase in motor vehicle registration, or some other tax.

There are more than 420,000 vehicles in Jamaica on which owners, by and large, pay an annual licence fee of $3,300. They also, annually, have to ensure the worthiness of the vehicle, for which the government agency that conducts the tests charges $1,200.

Undue penalties

But Jackson insists that these arrangements do not provide the best value and believes the heavy duties on vehicles unduly penalise their acquisition.

Commissioner of Customs Danville Walker is among those who remain unconvinced that Jackson's idea is a better way to tax the ownership of vehicles.

"It is better when the person decides to buy a car that he pays that tax on a one-off basis rather than a slow death over the life of the car," Walker said. "One does not want the authorities in their pockets to drench them to death for keeping the car."

mark.titus@gleanerjm.com