Car imports up by 9% to 26,000 in 2012

TIRANA, April 17 – After sluggish imports in the first three quarters of 2012, car imports, mostly second-hand ones, in the final quarter of 2012 saw a boom. Some 26,113 cars, worth 5.5 billion lek, were imported in the final quarter of 2012, taking the total number of imported cars during the whole of 2012 to 56,499 cars, up 8.8 percent compared to 2011.
In the final quarter of 2011, when customs duties were lifted significantly lowering their prices and a new law on annual taxes discouraging the use of old cars entered into force, a record 23,503 cars were imported, six times more compared to the final quarter of the previous year.
Having to pay only 20 percent in value added tax, some 51,894 cars were imported in 2011, more than treble compared to 2010.
While the new law lifting customs duties cut second-hand car prices by at least 30 percent, Albanians increased purchases for cars produced in the past 5 to 10 years, also because of the new tax system considerably increasing annual fees for older motor vehicles.
The removal of customs duties was accompanied with a new taxation system based on cars’ age, the engine capacity and the kind of fuel they use.
Car taxes which since September 2011 have seen a sharp rise for second-hand cars more than 10 years old will have the taxes cut in a move taken just two months ahead of next June’s general elections. Finance Minister Ridvan Bode says taxes will be reduced by cutting the fixed petrol and diesel rates in the calculation formula, automatically having the taxes.
The decision foresees the fixed rate for diesel will be cut to 12.5 lek, down 25 lek currently while the petrol rate will be halved to 10 lek down from 20 lek. Currently, a six-year-old diesel car with 1,600 cc engine, pays 8,000 lek in annual taxes but will pay 4,000 lek after the new changes enter into force.
The new changes affect the state budget with 2.5 billion lek (Euro 17.5 million) and are expected to enter into force next June.