Prices of new cars

ACIM - the Association of new Car Importers is amazed at the conclusions reached in your report 'Price of new cars falls sharply' (July 11).

Our Association objects particularly strongly to this paragraph:

"This (the high importation of second-hand cars) also had a significant impact on the Maltese market where car agents realised they couldn't keep charging exorbitant prices and losing clients, the sources said."

Your reporter should have known that up to the end of 2008 new cars imported into Malta were paying much higher registration tax. In all other EU countries, only VAT is charged on cars. He should have compared like with like.

With effect from January 1, 2009, the system was changed and registration tax (RT) was charged on new cars depending on the value, length and the CO2 emissions. VAT is no longer being charged on RT, which was also a significant value. It was incorrect to say that RT is nowadays based on emissions and engine capacity.

Several new car importers are advertising the prices of new cars and at the same time giving a breakdown of car price and RT plus VAT.

This is being done to enable the Maltese public to compare local prices with those abroad. In Malta car prices are higher since RT is being charged.

Car importers have never charged exorbitant prices and, even now, when most of them are suffering due to lower revenue caused by the importation of second-hand cars, are not applying excessive mark-ups.

How does your reporter dare to make arbitrary statements when he does not know what we are being charged by the manufacturers for their products?

For his information, several of our principals have reduced their prices to help us overcome this nightmare of overused second-hand cars from the UK and Japan.