South Africa’s vehicle taxation model, which has remained largely unchanged for decades, adds significantly to the retail cost of new vehicles. With multiple layers of duty and tax applied to imported vehicles – including customs duties, ad valorem taxes, and VAT – the result is a final price that can be well beyond the reach of many consumers.
How does the system work?
Imported vehicles are subject to a variety of charges, which collectively push up the total cost. The structure was originally designed to protect local manufacturing, but with the global automotive industry rapidly evolving, many believe it may no longer serve the market as effectively as it once did.
What’s the impact on the industry and consumers?
Higher vehicle prices reduce access to newer, safer, and more fuel-efficient models. For consumers, this means fewer affordable choices. For the automotive industry, it can limit growth opportunities and discourage broader investment – particularly in segments like electric vehicles or budget-friendly imports.
Why it matters now
As vehicle ownership remains an aspiration for many South Africans and a vital part of economic participation, the pricing barrier created by outdated tax structures is a growing concern for stakeholders across the automotive value chain.
Read the full article on MyBroadband here:
https://mybroadband.co.za/news/motoring/587479-outdated-tax-making-cars-expensive-in-south-africa.html
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