Finance Minister AMA Muhith's 2013-14 budget will make those looking to buy cars happy.
The prices of reconditioned private cars will drop -- older the car, the cheaper.
While Bangladesh allows import of vehicles up to five years old, the Minister came up with a taxation proposal going by the age of the cars.
“The government, besides discouraging use of private cars, revised tax and duty on cars in 2009-10 and 2010-11 budgets to increase revenue,” Muhith said.
That raised the price of the cars and in some cases “prices of old cars were higher than new ones".
Reconditioned vehicles now incur a total of 25 percent depreciation and 10 percent dealers commission – 35 percent in all.
The Finance Minister proposed a year-based depreciation system – zero percent for an one year old car, 30 percent for cars between 1-2 years old, 35 percent for those 2-3 years old, 40 percent for 3-4 years old and 45 percent for 4-5 year old cars.
Muhith said under the new system dealers will not be entitled to commissions separately and the value of reconditioned cars on which depreciation will be allowed, will not be more than price of a new car.
Former Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) President and current FBCCI Director Abdul Haque sounded happy with the proposal while talking to bdnews24.com.
“People will now get cars at lower prices but revenue will also increase.”