In beautiful British Columbia, a mountain- and wine-filled area north of Seattle, the provincial governments recent budget has some auto dealers steaming mad and worried their customers will hit the road in search of deal.
The provinces New Democratic Party government, elected last year, plans to levy a 25 percent tax on the purchase of very high-end vehicles, with lesser models facing a 20-percent markup.
One factor not helping the sympathy is the provinces troubled auto insurer (British Columbians get their coverage from the government) and its projected.8 billion-dollar loss this fiscal year.
Where a consumer can go to another jurisdiction to save money, they will, Qualey said.As more and more British Columbians snap up mega-buck vehicles, the insurer faces an ever-higher number of claims not covered by the owners premiums.Private sales are also subject to the new PST ceiling.The vehicle surtax breaks down like this: models retailing for 125,000 to 149,999 see the provincial sales tax (PST) rise from 10 to 15 percent on April 1st.Dealers admit it will be hard for the public to feel sympathetic to the luxury car buyers plight a six-figure car is no ones idea of a necessity of life.Its a psychological thing for people.While its hard to argue against many government-funded social initiatives, dealers dont see the new taxes panning out. Then the province will lose out on the sale completely.Obviously, a ripe target for lawmakers armed with calculators.After hitting it big with the Fab Four, George Harrison wrote the scathing song.Depending on who you ask, the taxes are either too steep or not high enough.
In this case, the government claims the extra revenue will go towards increased spending on child care and affordable cafe rouge worcester voucher housing a popular platform in Vancouver, a city where home prices make San Francisco look low-rent.
Qualey, president and CEO of the New Car Dealers Association.C., said, Our members who sell in the market are gravely concerned.
At the time, the boys faced a 95 percent tax on their earnings (Theres one for you, nineteen for me and Harrison reportedly did everything he could to offshore his wealth.
My phone has not stopped ringing, Blair Qualey told.At one Vancouver Ferrari-Maserati dealer, general manager Mark Edmonds said he expects would-be buyers will consult their wallets before buying a new vehicle locally.Last year, making up roughly a third of the provinces auto sales.However, many dealers wonder where the law of diminishing returns comes into play.That could change if the government doesnt get the haul it expected.Sales of luxury vehicles rose 9 percent.C.Cars costing 150,00 or more will see that surcharge rise to 20 percent.Maybe now theyll buy a boat instead of a car, or maybe a vacation property.