Buying A Car In Spain Just Got Cheaper - Or Did It?
Here s what you need to know. When buying a car in Spain, the price of the car is made up of three components. 1. What the manufacturer/dealer makes out of the deal. 2. The IVA (Spanish equivalent of VAT) levied at a rate of 16% on the price of the car as charged by the dealer, its franco-fabrica price, liberally translated as the factory-fresh price of the car and 3. A not-insignificant part of the on-the-road price of a car in Spain is the impuesto de matriculacion, the registration tax. This registration tax is set, at least until 31 December 2007 by reference to the size of the engine. A petrol engined car up to a 1.6 l and a diesel up to a 2.0l currently pays 7% for registration whilst cars with engines any larger than that pay 12%.
The system was devised a long time ago when there was little if no emphasis on the emissions a vehicle s engine produced. A call for change was heard and a re-focus of the selection criteria considered to make the measures fall in line with European development on the subject
The Spanish government therefore approved, in July of this year, new legislation changing the method of calculation and the rates of tax to be paid, calculated by reference to the car s rated emissions on the following scale:
According to official statistics, approximately 64% of the vehicles registered in Spain over the course of 2006, had a rated emissions rating of less than 160g/km. What this means is that where that large proportion of people buying a car in Spain were paying 7% in registration tax, as of 1 January next year, that same number of people will be paying a maximum of 4.75% in tax. That s without taking into consideration the ever increasing number of cars available on the market with emissions below the magic 120g/km mark which will pay no tax at all.
The gas guzzlers, as ever, are being targeted as the anti-Christ of the environment. Buying a luxury car in Spain with higher emissions, is going to cost that little bit extra than it used to. In a market where luxury cars are already substantially more expensive than in other European countries, the well-off will truly pay the premium.
Thankfully, for the rest of us, it s good news. Or is it? Talking to some dealers, I suspect that you, Joe Public, won t automatically see a dip in the price that you pay. Why? Dealers know that you know how much their cars cost because they post the price of their products on the internet for all to see. They also know that if you want what they have, you re ready to spend that much today and tomorrow. After all, if you re happy to spend 25,000 on a car today, why wouldn t you be happy to spend the same on New Year s day! Who cares that the manufacturers might, overnight, add a few percentage points to their annual revenues? They certainly don t!
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admin on January 19th 2008 in automotive


