Saturday, 29th November 2008
Reduction in car prices simply not enough
While zapping through the TV channels, I came across a discussion on Smash TV between Minister Tonio Fenech and a journalist from the same station.
The discussion was about the recent budget and its implications. By chance, at that precise time, the recent changes to car licence fees and the registration tax regime were under the spotlight.
The minister was busy telling the interviewer that the reason for the increase in road tax and the reduction in registration tax was to encourage people to get rid of their old car and buy a new, less polluting one or else keep the old one and pay, through higher licence fees, for the pollution it causes. So far so good and I am all in favour of this approach. At one point the minister, with a certain sense of amazement, stated that while in Europe the average age of cars is seven to eight years, in Malta it is 15 years! Well, with car prices in Malta being among the highest in Europe, that's hardly surprising, is it?
Despite the minister's best intentions, I don't think, come 2009, new car sales are going to shoot through the roof! With my car hitting eight years, I am thinking of buying a new car and have started shopping around.
However, at the end of the day, the drop in car prices is not very encouraging. A particular 1400cc European mid-size family car which was selling for €19,800 before the budget now sells at €18,635. Just 60 miles north of these islands the price is nearly €3,000 less for the same model.
Given the average salary in Malta, the ever increasing costs of energy and basic day-to-day requirements, and now the less than spectacular reductions, people will just stick to their old cars and unavoidably pay the higher circulation tax.
More income for the government, more pollution for us. Green budget... hmmm?
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Comments
Paul, you are very wrong. Go ask any mechanic. Driving in Malta is basically limited to the urban cycle i.e stop and start, short distances. Add to that the horrible roads which reak havoc on suspensions, balljoints and steering and you have a situation where cars deteriorate quicker here than they do in other countries.
A car engine is most economical, and most clean, at higher speeds on higher gears. And it follows that it is less stressed mechanically. .
To be really honest, the long and short of it is that I cannot afford a new car that meets my present needs (an estate). So, I will just have to fork out the increased circulation tax on my current vehicle.
As to the apparent amazement expressed by the minister to the fact that we hold on to private cars longer, perhaps the minister should remember that not all of us qualify for automatic privileged discounts or get a government car replaced every 8-10 years.
When one has to compare, he has to compare "like with like".