So, how much does a 1350cc car cost?
Volume 32, No. 634
July 9 - 15, 2012
LAST week The Myanmar Times reported on the confusion over the costs of importing a vehicle under the government’s various car import programs.
This week we are pleased to provide a breakdown of the costs of importing a 2007-10 model passenger car with an engine capacity of 1350 cubic centimetres or less to clarify what you should expect to pay. Under the latest import program, which was announced by the Directorate of Road Transportation in early May, buyers have been encouraged through tax reductions to import cars with small capacity engines.
Here is a breakdown of the taxes:
The cornerstone of the reductions is fixing the cost, insurance and freight (CIF) value of eligible sub-1350cc cars at US$5000, although importers must still pay customs duty of 30 percent, commercial tax of 25pc on the combined CIF and customs duty, a road licensing fee of 50pc of the freeed on board (FOB) price, freight charges and a fee to the importer if one is used.
Customs duty – $1500; Commercial tax – $1625 (CIF value of $5000 + commercial tax of $1500 = $6500); Road licensing fee – $2083 (set using a freeed on board price of $4166.5, which is the CIF value minus 16.67pc); Shipping costs – about $1000. Added together these costs total $6208 or K5.463 million at last week’s exchange rates. Expect to pay about an extra $1000 if you use an importer.
Importers must also buy the car from abroad – mostly Japan, where prices of small-engine cars are rising as a result of buyer interest from Myanmar (see main story).
Prices of popular models, such as the Toyota Vitz and Honda Fit, at auction yards in Japan have climbed to between K7-9 million. This means a Honda Fit bought at auction in Japan for $7900 will cost about $15,000 or K13.2 million to import.
While cars with marginally larger engines are available more cheaply at auction, they will still cost considerably more to import because, rather than a flat amount, the CIF price is set according to the government’s valuation book. The final price of a car with an engine larger than 1350cc bought in Japan for about K4.5 million ($5200) will be at least K18.5 million ($21,000), not including the agent’s fee.