Auto dealers baffled at how registration tax will increase by €2,000 for low-emission hybrid cars

Matthew Vella
The price of eco-friendly cars that are powered by both electricity and petrol – so called hybrid engines – will bizarrely increase once the new emissions tax regime comes into force next year.
Auto dealers and importers who spoke to this newspaper said hybrid engines will no longer enjoy a preferable 16.5% registration tax on their CIF value (cost-insurance-freight value), but actually increase in price because of the new registration tax, which is supposed to penalise polluting cars.
Government says the new tax to be introduced in 2009 serves to encourage the purchase of smaller cars with lower carbon dioxide (CO2) emissions and with cleaner technology.
Despite its ‘polluter-pays principle’, the price of hybrid engines can be expected to increase by over €2,000, as an exercise carried out by MaltaToday shows.
The new registration tax is calculated according to the carbon emissions, length and importation price of vehicles. The mechanism, declared by government to be “just and transparent”, penalises larger cars and those emitting large volumes of CO2.
Previously, cars were taxed anything between 50% to 75% on their import price, according to their engine capacity: the bigger the engine, the greater the tax.
However, electric and hybrid cars were levied with just 16.5% on their import price, a measure that served to encourage the use of clean technology vehicles.
Dealers from the Toyota and Honda dealerships, who sell the Toyota Prius and Honda Civic Hybrid respectively, told MaltaToday that prices on their cars were expected to increase in January, once the new registration tax kicks in.
Government claims the new tax will knock off anything between 28% to 44% on the tax previously payable on cars’ import value, with low-emission vehicles experiencing the biggest reductions in tax.
And yet, a comparison of the prices for the Toyota Prius and Honda Civic Hybrid clearly shows these low-emission cars can expect to see their tax increase by €2,189 and €2,269 respectively.
It is also possible however that they will still incur less tax than other petrol-fuelled family cars. In fact, the difference between the new tax and the old 16.5% tax actually shows how favourable rated these hybrid vehicles were.
Four other models compared by MaltaToday, namely the Alfa 147, Audi A3, Volvo S-40 and the BMW 1-series, could be expected to see tax cuts of 6% in the case of the Alfa 147, to 49% for the BMW 1-series.
The Alfa 147 in fact emits CO2 levels of 194g/km while the BMW 1-series has emissions of 139g/km.
But the Toyota Prius and Honda Civic have emissions of just 104g/km and 109 g/km respectively. The Prius is actually certified by the California Air Resources Board as an ‘Advanced Technology Partial Zero Emission Vehicle’ (AT-PZEV) due to its low emissions.
Hybrid engines work on a combination of electricity and petrol. In the case of the Prius, the car works on electricity up to speeds of 50km/h. They then switch to petrol, but they revert to electricity if the speed is kept constant.
The petrol engine normally shuts off during traffic stops, and accessories such as the air conditioning are powered by the battery pack.
They are also self-rechargeable, by converting kinetic energy during braking into electrical energy.

mvella@mediatoday.com.mt

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