Opel Turkey General Manager Alpagut Girgin announced that he expects an intervention in the special consumption tax (SCT) applied to cars.
Girgin stated that the purchases for investment purposes decreased and he also said that he expects the second hand prices to increase.
Opel Turkey General Manager Alpagut Girgin spoke about the sector at a press conference in the Turkish Republic of Northern Cyprus.
According to the world Girgin said that he expects an intervention on the SCT issue very soon. Girgin, “I do not agree with the views that there will be no change in the SCT. I foresee that there will be an update on both increasing the tax brackets and raising the scales.” said.
The agenda of politics is also SCT
Turkey is the country with the highest automobile tax in the world. Depending on the engine size and price of the vehicle, the SCT can start from 45 percent of the sales price and go up to 220 percent. Due to the high rates, taxes are more than half of the price in many models. In some models, this rate reaches three times the bare price of the vehicle.
Due to the rapid increase in the exchange rates, the government went to the SCT regulation in January when there was almost no model left in the 50 percent segment of the group under 1600 cc, which constitutes the majority of the automobile market in Turkey.
The high SCTs taken from the vehicle, which constitutes 6 percent of the central government budget revenues, are also the subject of politics.
CHP Chairman Kemal Kılıçdaroğlu promised ÖTV in July, saying that when they came to power, they would only use SCT on luxury vehicles. ”You know, I said that there is no excise duty for young people’s first new car purchases, it remains. We will also reduce taxes on light commercial vehicles. All you have to do is postpone your car purchase for now. And to wait for our power for a short time. Don’t buy a car. When we come, we will draw the SCT in the vehicle segments that are most sought after by our people. We will also apply the SCT to those who buy luxury vehicles” he said.
Immediately after Kılıçdaroğlu’s statement, President Tayyip Erdoğan was given the authority to reduce the SCT to zero and increase it up to three times. was given.
‘Investment purchases are almost over’
On the other hand, consumers have started to see vehicles as an investment tool rather than a consumption tool since last year due to constantly rising prices and the lack of products to sell.
Opel General Manager Girgin stated at a launch in May that the purchases of automobiles for necessity fell below 70 percent and said that most of the purchases were for investment purposes.
Girgin stated that now the situation has changed and investment purchases are almost over: “We haven’t received our official analysis results yet, but the number of customers who bought investment vehicles in August approached zero. There are two important reasons for this; First of all, the purchasing power has now reached a very low level in terms of vehicles. Secondly, these SCT conversations we all experience confused people.”
‘Prices may go up’
The regulation of the Ministry of Commerce for second-hand vehicle sales was published in the Official Gazette on 16 August. Accordingly, those engaged in the trade of second-hand land vehicles will not be able to directly or indirectly market or sell their automobiles and off-road vehicles before 1 July 2023, unless six months and six thousand kilometers have passed from the date of first registration. The Ministry will be authorized to extend this date for up to six months.
Evaluating the impact of this change on the sector and vehicle prices, Girgin said: “We did not see a significant impact of this regulation on new vehicle sales. Our client portfolio is just a little filtered. The clientele of the galleries decreased. Currently, the priority of the galleries is zero km until September 15th. sell your vehicles. For this reason, there may be a decrease of approximately 5 percent in second-hand prices in the short term. However, if a sufficient supply of new vehicles is not ensured, second-hand prices, on the contrary, will go even higher due to availability.”