The national government ordered changes in the so-called “luxury car tax”which will govern until the end of 2024, with quarterly updates.
The failure to update this tax had generated a slowdown in sales in the automotive sector since the beginning of January since with the price increases in December, it is estimated that almost 90% of 0 km vehicles were covered by the tax.
As of decree 84/2024 published in the Official Gazette, the minimum taxable base of the internal tax on vehicles will reach vehicles whose factory outlet price is equal to or less than $20 million and its final value reaches approximately $28 millionreported from the Ministry of Commerce.
The 50 cars that will arrive in 2024
With the new update, vehicles that are exempt from paying the internal tax go from $10.364.800 a $19.826.151.For their part, units exceeding this figure and their price is equal to or less than $36,602,126, must pay a 20% rate, which represents an approximate value of $63,000,000 for the final consumer. Meanwhile, those who exceed that amount must pay 35% tax.
For their part, they also established new scales for motor vehicles. Starting this Thursday, the factory prices of motorcycles that are not covered by the tax go from $3,684,000 to $5.324.000. From that amount up to $6,826,234 will be taxed at a rate of 20%; In the event that the aforementioned price is equal to or greater than this last amount, the 30% rate will apply.
The Undersecretary of Industrial Policy, Daniela Ramos, stated that “It is a long-awaited measure by automotive companies and dealerships. “We hope that from now on it can be resume the dynamics of the sector in the first months of the year”.
How the tax will be updated
From the Ministry of Commerce they indicated the system for updating the minimum tax base will continue to be quarterly, but will come into force in the month following the publication of the Consumer Price Index, its application being brought forward one month to avoid mismatches between inflation and the prices achieved by the internal tax.
Automotive market
According to the Association of Automotive Dealers of the Argentine Republic (ACARA), During 2023, 449,438 units were patented, which represents 10.2% more than in 2022.
According to Sebastián Beato, president of ACARA, during 2024 “it is evident that we will have an activity with a tendency to slow down, that is why we corrected the projections we had. We now see a market of 340,000 patents by 2024 although we may also have to adjust that number downwards again in the coming months.”
LM CP