Keith Zahra, communications coordinator, Ministry of Finance, the Economy and Investment, Valletta
Vehicle registration regime
Reference is made to the letters by Philip Anthony Hagan and Allan Purves and the alleged discrimination against foreigners or persons registering vehicles that had been previously registered in any other country.
The revision of the vehicle registration taxation regime (M1), introduced in January 2008, paved the way for the importation of vehicles that are less polluting it incentivised those vehicles which are generally smaller and newer.
When looking at the differences between the older system and the new one, one has to keep in mind that, while the government needed to create a system to safeguard its environmental obligations, it also had a social obligation towards those persons who had already registered their vehicles under the older tax regime. The two charts mentioned by Mr Purves reflect the two different tax regimes. What has not been mentioned in the letters is that, in general, under the old tax regime, the registration tax was much higher than what is now being paid under the new system on the same model of vehicle. Obviously, the same levels of fees cannot be applied to those vehicles which had already been registered and taxed before the introduction of the new legislative parameters.
Contrary to what has been stated in the letters, during the first year since the new legislative framework has been in place, it has been proven that, besides the fact that newer vehicles are being put on the Maltese market, those purchasing second-hand vehicles are now opting to buy newer vehicles, which are smaller and less polluting.
Both Mr Hagan and Mr Purves have been misguided; there is absolutely no discrimination because, under the new system, anyone who purchases a vehicle from Malta or within any other EU member state will be charged exactly the same registration tax and pay the same amount of annual circulation licence fee.
In line with our obligations not only to safeguard the local environment but also that of the EU, of which we are members, the system also allows to disincentivise the purchase of older, more polluting vehicles.
Comparing different legislative environments without including and putting everything into perspective gives a much different scenario.
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Erin Ciantar
Dec 3rd 2009, 22:10
Does anyone know what the situation is regarding Hybrid vehicles? What tax is paid and if the government website has been updated to show the correct registration on new and second cars after the last budget.
Thanks
Francis Bellizzi
Dec 3rd 2009, 20:50
Excuses nothing else. It`s an exercise in blackmailing the Maltese motorist. The choice is pay up or don`t drive. Where do they get these people from? I think the Maltese should hire foriegners to govern the country because I don`t think the local politicians are capable. Malta is the most expensive country in the EU to run a car in.
As for protecting the environment, why encourage cars that are old and high polluters. As it is we are a joke with everyone that`s been on holiday in Malta. All they talk about is old bangers churning black smoke. If the government wants more taxes surely a tax on petrol is fairer, the more milage one does the more tax he pays.
George Borg
Dec 3rd 2009, 18:06
Mr Zahra,
with such moves as the new registration regime. The goverment is only safeguarding its inefficiencies and not the environment, at the tax payer's expense. Old cars under the old regime will be taxed more in annual circulation taxes. New more efficient cars will pay less annual fees but fork out the money upfront when touching our shores. Nice!!!!!
When registering a new car, most of the tax is based on the RV value and the lesser part on the CO2, which by the way, the RV never seem to be updated by ADT.
R. Mallia
Dec 3rd 2009, 16:24
"safeguard the local environment but also that of the EU", please this is an insult to our intelligence. It is very obvious that in all measures taken by ADT regarding vehicle registration tax the primary aim is cashing the highest amount of revenue possible. The whole regime is a legalised rip-off and day-light robbery. Dear ADT and authorities concerned, have a look at other EU small countries regimes and learn that we are EU members in all aspects and not just in those aspects which are comfortable and revenue-generating for the government. Cars on the continent are at least 30% cheaper than in Malta and why is this? surprise! They don't charge exorbitant registration fees!
Prof. Paul Sant Cassia
Dec 3rd 2009, 15:48
Mr Zahra is being specious and disingenuous. He says Government "had a social obligation towards those persons who had already registered their vehicles under the older tax regime". Fine. But how is this maintained by charging a much higher circulation tax for post 2009 vehicles.? It is a non-sequitor to say that in order to protect old cars under the old taxation regime you increase the road tax for new taxation regime vehicles. Unless of course what he means is to preserve their second-hand values because their circulation tax is lower. But how does result in the reduction of older more polluting cars from the roads? If Mr Zahra is so interested to " disincentivise the purchase of older, more polluting vehicles", how is that pursued through the retention of lower circulation taxes for pre-new-taxation regime cars? This is no polluter-pays principle which would tax actual petrol consumption but a disguised form of symbolic property tax. Mr Zahra should stop trying to clothe pure revenue-gathering initiatives with fake environmental pietism. If he really believes in the environment it is actual petrol consumption that should be taxed, not cars in garages.
E.A. Mallia
Dec 3rd 2009, 14:20
Can I interest Kevin Zahra in a case of discrimination and confusion? Before the new registration and circulation tax regime, electric cars were classified by 1. Continuous power of motor in kW. 2. Change into HP by multiplying kW by 4/3. 3. Deriving a ficticious "engine capacity" by multiplying HP by 100cc. So a 12kW motor = 16HP = 1600cc. Apart from the 1960 engineering equivalent 1 HP = 100cc, in the EU engine or motor power is given in kW. Despite the fact that "log-books" do have a kW box, electric cars here have continued to be tagged with "cc".
When the new circulation tax into force, there was a box with the tag "electric cars €75". The The Ministry of Tranport said 'electric cars have a flat rate.' Only somebody forgot to put electric cars on the working sheets at the ADT desks. Result: the old 'cc' designation remained 'in force'. My converted 1972 Ford escort-- 12kW motor = 1600cc-- had its circulation tax increased from €104 to €208!
Another injustice is being perpetrated against hybrids which are taxed on the cc of their petrol engine and not on mpg, which correctly reflects their CO2 emissions.
Michael Krampus
Dec 3rd 2009, 12:08
Why paying tax for cars in Malta at all ? The good roads are paid by Brussels, and the bad roads do not reflect the tax-payers demands.
If the government wants more money they should extend the ship-
registration-business from international waters to international roads.
They should invent a temporary import-number-plate issued by the embassies to Maltese of future residents of Malta living abroad which can be renewed annually for a low fee.