Tightened standard for green-vehicle tax exemption

Authorities yesterday announced a tightened standard for which environmentally friendly vehicles will be eligible for preferential tax. This will rule out nearly half of the 134 car models that have enjoyed an import tax reduction since March 8, 2012.
The new standard, published in the Official Gazzette, sees the lower limits on fuel efficiency revised according to different vehicle weights, while it retains the previous environmental emission limits. Furthermore, a new specific list of car models entitled to the tax reduction will be released on the Financial Services Bureau’s website, according to the Macau Motor Traders Association president, Patrick Tse.
Macau started implementing preferential tax for those purchasing environmentally friendly vehicles three years ago. Prior to yesterday, a total of 134 car models had enjoyed a tax reduction. Mr Tse told the Times that the new standard is expected to rule out about half of those on the list.
“The new standard is regulating [vehicle eligibility for the preferential tax] in three aspects: emissions of air pollutants; vehicle weights; and fuel consumption. Now that the standard on cars’ fuel consumption [in relation] to the cars’ weights has been implemented, we estimate it will rule out about half of the previously listed car models,” he explained.
In the new standard, minimum gas mileage for cars weighing 2,266 kilogram and above was tightened from 8.2km/L to 10.5km/L by both the European Union’s and China’s testing procedures; whereas minimum gas mileage for cars between 1,516 and 1,766 kilograms was increased by 1.9Km/L.
Mr Tse said that the tightened standard “will bring a certain hit to the sale of cars,” especially to those in lower-middle ranks that sell for between MOP200,000 and MOP250,000.
“The list won’t been released until tomorrow [today], but according to the revised standard, traders are already aware which models of what brands will be affected. I think the heavier cars above 2,500km or 3,000km with less fuel efficiency are more likely to be ruled out.”
Although the new announcement will take effect quickly, Mr Tse says this was an expected change for the sector. “The sector has been communicating with the government since last year. When the preferential tax was first implemented, we were told [by the government] that it would be reviewed after a certain time. Given that recently the government has been talking about controlling the increase of private cars, we had expected that there would be changes in license plate price and the tax standard following the Policy Address,” he said.
The new standard is being implemented with a 180-day buffer period for vehicles that are ruled out in the new list, but which had been purchased before yesterday. Accordingly, related vehicle importers must submit supporting documents to the Transport Bureau within 15 days from today.