As autumn approaches, a tax increase on cars is set to take effect. The value added tax on cars will rise from 24% to 25.5% in September, potentially leading to hundreds of euros in price increases for consumers at car dealerships. However, the chains and brands have not yet announced how they plan to adjust prices in response to this tax hike.
The impending price increases have caused a surge in new car purchases, with buyers hesitant to commit due to the uncertainty around pricing. Additionally, punitive tariffs imposed by the EU on electric cars manufactured in China are expected to further impact prices. This general increase in taxes on all new cars will come into effect at the beginning of September.
One way for consumers to avoid the tax increase is by purchasing a car before the last day of August. This strategy is being promoted by the automotive industry as a way to incentivize summer car sales. Additionally, the lessening of component shortages for electric cars has reduced delivery times, making it easier for consumers to receive their vehicles in a timely manner.
For used car sales, the tax increase may not have as big of an impact, as dealerships typically only pay taxes on their profit margins. However, used car prices may fluctuate depending on how new car prices are affected by EU tariffs. Despite potential price increases, it’s important to consider the broader goals of the tax hike, such as promoting fair competition and contributing to government revenue.
