SA’s emission tax and the affect on Namibia

THE CO2 emissions tax on new passenger motor cars, including SUV’s, was first mooted during the 2009 budget speech in South Africa, and again in the 2010 speech with an implementation date during 2010.

During this period, NAAMSA representatives engaged extensively with National Treasury in South Africa regarding the specifics of the tax calculation, administrative issues and the implementation date, with the final legislation stating an implementation date of the 1st of September 2010 and the calculation of the tax being based on the following formula: 120 - CO2 (g/km) x N$75 plus VAT.

For example a vehicle with a CO2 value of 145g/km will incur a tax as follows: (145-120) x 75 plus 14% VAT = N$2,137.50 Vehicles’ CO2 emissions are clearly displayed on the fuel consumption labels that is placed on all leading vehicle brands.

Some of the South African manufacturers, namely Toyota, have placed their vehicles’ CO2 emission levels, as well as the tax amount, on the specification hanger inside their vehicles. In the case of a vehicle with emissions below the 120g/km threshold, a zero tax value will apply.

This tax will be payable by the manufacturer, who unfortunately has to pass on this cost to the respective dealership, which will be included in the selling price. The tax will be levied on new passenger vehicles and SUV’s only from the 1st of September 2010.

Commercial vehicles such as the Nissan Navara, GWM Steed range, Toyota Double Cab Hilux models and Land Cruiser Station Wagon will also be levied as from 01 April 2011; however, the tax calculation will not be the same as on a passenger vehicle. How this will be calculated is unconfirmed at present. How are Namibia dealerships going to implement the tax?

Basically, Pupkewitz Motors division outlets that purchases any new vehicle from South Africa before 01 September 2010, will not incur the CO2 emissions. However, vehicles purchased after that date will unfortunately be subject to this new tax levy. Dealerships that have new stock on hand (i.e. it has been invoiced by the South African manufacturer) will be exempt.

Commenting on the implementation of the CO2 emissions tax, Junior Bruwer, Managing Director of Pupkewitz Motors Division said: “Our dealerships have strategically planned for the implementation of this new tax and where possible, we have secured stock or have had the stock landed already here in Namibia. Thus we urge those buyers that are currently looking at purchasing new vehicles to make use of this opportunity to purchase their vehicles, while we have it at this reduced price.

“Another point to note is that by virtue of the fact that minibuses are used predominantly in South Africa for public transport purposes, these vehicles will be excluded from CO2 emissions taxes. The application of CO2 emissions taxes to other types of light commercial vehicles will be considered for a future date. Implementation timing, in this regard, will depend on the finalisation of CO2 emissions testing standards and developments in the European Union. We shall monitor the situation and keep all our stakeholders informed of any developments.”