Economist Rovshan Agayev commented on government’s steps to ban imports of cars with service life exceeding 10 years.

He believes that 3 more steps are necessary as a continuation of this measure, which is claimed to be aimed at reducing the negative impact of cars on the environment.

First of all, at the moment only electric cars with a service life of 3 years or less are exempt from all customs taxes and duties. However, in international practice, cars under 5 years old are not considered “old”. Therefore, in his opinion, the 3 year grace period should be replaced by 5 years.

The expert notes that although hybrid cars with up to 3 years of age are exempted from 18% VAT in Azerbaijan, they are subject to 15% import duty and excise tax depending on the engine volume. He suggests exempting hybrid cars with up to 5 years of service life from customs taxes and duties.

According to Rovshan Agayev, cars with a small gasoline engine (up to 1,600 cc), whose service life does not exceed 5 years, could also be exempted from all customs taxes and duties for the next 3 years.

“These steps are important steps in terms of renewing the vehicle fleet and supporting the transition to green energy. Furthermore, the government, as in other countries, may consider subsidizing imports of electric cars for a certain period,” said economist R. Agayev.

Source: Turan News Agency