XN000022-1990-03-07 — Page 35

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WEDNESDAY, MARCH 7, 1990

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WITH DUTY MERGE THE TWO CATEGORIES OF STILL WINES INTO ONE, PAYABLE AT $24 A LITRE PLUS AN AD VALOREM RATE OF 20 PER CENT.

THE ADDITIONAL REVENUE YIELD WAS ESTIMATED TO BE $50 MILLION.

TOBACCO

SIR PIERS PROPOSED TO INCREASE THE DUTY ON TOBACCO BY ABOUT PER CENT, FOR FISCAL AND NOT HEALTH REASONS.

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TO $240 PER THE DUTY ON CIGARETTES WOULD INCREASE FROM $190 1,000 STICKS. THE DUTY ON CIGARS WOULD BE INCREASED FROM $250 TO $310 AND ON A KILOGRAM; ON SMOKING TOBACCO FROM $230 TO $290 A KILOGRAM; CHINESE PREPARED TOBACCO FROM $50 TO 860 A KILOGRAM.

HE ESTIMATED THE ADDITIONAL REVENUE YIELD TO BE $400 MILLION.

INCREASED TAX RATES FOR PRIVATE CARS, GOODS VEHICLES

THE

FINANCIAL SECRETARY, THE HON SIR PIERS JACOBS, TODAY PROPOSED TO REDEFINE THE SCALE WHICH DEFINES BASIC, SEMI-LUXURY AND LUXURY CARS TO REFLECT MORE REALISTICALLY THE CURRENT VALUE OF VEHICLES AND TO INCREASE THE TAX RATES FOR PRIVATE CARS, MOTOR CYCLES AND TRICYCLES AND GOODS VEHICLES BY 10 PERCENTAGE POINTS.

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PROPOSE, AGAIN FOR FISCAL AND NOT TRANSPORT REASONS, TO CHANGE THE RATES AS FOLLOWS: 80 PER CENT TAX ON A BASIC CAR; 90 PER CENT TAX ON A SEMI-LUXURY CAR; AND 100 PER CENT TAX ON A LUXURY CAR, ** SIR PIERS SAID IN HIS BUDGET SPEECH.

THE FINANCIAL SECRETARY SAID THAT HIS PROPOSALS WOULD HAVE NO PRACTICAL EFFECT ON THE RETAIL PRICE OF A BASIC OR A SEMI-LUXURY CAR AS DEFINED IN THE NEW SCALE AND THEY WOULD INCREASE THE RETAIL PRICE OF A LUXURY CAR BY ABOUT THREE TO FOUR PER CENT.

HE ESTIMATED THE ADDITIONAL REVENUE ARISING FROM THESE INCREASES TO BE $200 MILLION.

SIR PIERS POINTED OUT THAT THE LAST REAL INCREASE IN THE FIRST REGISTRATION TAX ON MOTOR VEHICLES DATED BACK TO 1982, AND THE SCALE WHICH DEFINED BASIC, SEMI-LUXURY AND LUXURY CARS HAD REMAINED UNCHANGED SINCE IT WAS FIRST INTRODUCED IN 1978.

FOR PRIVATE CARS, THE PRESENT SCALE DISTINGUISHED BETWEEN BASIC CARS, FOR WHICH THE RATE OF TAX WAS 70 PER CENT, SEMI-LUXURY CARS, FOR WHICH THE RATE WAS 80 PER CENT, AND LUXURY CARS, FOR WHICH THE RATE WAS 90 PER CENT.

/THE FOLLOWING