Car prices are set to go down with the Government’s decision to roll back the Special Consumption Tax (SCT) on imported vehicles that attracted the duty.

The minister with responsibility for Information, Daryl Vaz, says the tax cut, which takes effect today, will remain in place until March 31, 2010 when it will be reviewed.

He says Cabinet has approved the elimination of the 10 per cent SCT on vehicles priced at the lower end.

Importers of high-end vehicles, which attracted 70 per cent SCT will now pay 35 per cent.

Members of the motor vehicle industry, who are projecting much lower prices for buyers, have welcomed the move.

The president of the Jamaica Used Car Dealers’ Association, Kenneth Shaw, says the decrease will significantly cut the prices of many types of cars.

There will be no change in the price of smaller cars with CC ratings below
1,000, because they did not attract SCT in the first place.

Mr Vaz says the Government does not expect to lose revenue from the cut in the SCT on imported cars.

In fact, Mr Vaz says it should stimulate sales and could perhaps result in increased collection into the coffers of the state over the long run.

He has also announced that the Cabinet has decided to remove the restriction on the engine size of vehicles, which can be imported by persons benefiting from the government's 20 per cent duty concession.

However, the limit of US$25,000 on the value of the vehicle will remain in place.