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Macau government expects tax hike to lower vehicle growth rate

Responding to lawmakers’ doubts on the expected impact of new motor vehicle tax rates on lowering the city’s annual growth rate in motor vehicles, Transport Bureau (DSAT) Director Lam Hin San said he believed that once the new tax rates are in place the annual growth rate will drop by about 1 percentage point from […]

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UPDATED: 22 Dec 2023, 5:49 am

Responding to lawmakers’ doubts on the expected impact of new motor vehicle tax rates on lowering the city’s annual growth rate in motor vehicles, Transport Bureau (DSAT) Director Lam Hin San said he believed that once the new tax rates are in place the annual growth rate will drop by about 1 percentage point from the current 5.54 percent.

Lam also said that if civic society reached a consensus that the annual growth rate in motor vehicles should be lower than the expected rate of about 4 percent, the government would consider more “severe” measures to keep the city’s number of vehicles in check.

Lam spoke of his expectations during a plenary session of the Legislative Assembly (AL).

Secretary for Economy and Finance Lionel Leong Vai Tac and several senior officials of his portfolio including Lam attended the session to answer lawmakers’ questions about a government-drafted bill on raising the city’s motor vehicle tax rates.

The bill proposed that the tax rate for different kinds of cars which currently ranges from 30 to 55 percent of their retail price be increased to between 40 and 72 percent, while the tax rate for motorcycles which currently ranges from 10 to 30 be raised from 24 to 50 percent, depending on the respective retail price.

The bill also proposed that tourist coaches no longer be exempted from the tax.

The lawmakers unanimously agreed that the bill be approved as a matter of urgency so that it would not, as is customary, have to go through an article-by-article revision by one of the legislature’s standing committees after its outline was approved by the legislature.

After an article-by article vote, the bill was immediately approved by the legislature on Thursday. The bill will take effect the day after its official promulgation in the Official Gazette (BO).

Addressing the meeting, lawmakers including Zheng Anting, Mak Soi Kun and Angela Leong On Kei questioned the impact of the new tax rates on keeping Macau’s seemingly ever-rising number of vehicles in check.

Responding to lawmakers’ queries, Leong said he believed that the tax increase was one of the most effective ways keep the number of vehicles down.

Lam said he believed the number of motor vehicles would increase “moderately” under the new tax rates.

“I expect the annual growth rate of motor vehicles to be reduced by around one percentage point…it’s a moderate way to control vehicles. Compared to Hong Kong and Singapore where the tax rates of motor vehicles are 1.3 and eight times higher than Macau’s,” Lam said, adding it was a fact that the city’s traffic jams are getting worse, adding that 47 congestion “blackspots” had been identified by the authorities.

He also said that the daily peak hours for traffic jams were up from an hour in previous years to three hours.

“If there is a consensus in civil society that an expected annual growth rate of motor vehicles of about 4 percent is too high…then the government will come up with more severe measures such as financial means or speeding up the scrapping of old cars,” Lam said.

Macau had 118,648 automobiles and 128,602 motorcycles at the end of October, according to official statistics. A total of 1,355 new motor vehicles were registered in October, when 1,340 traffic accidents were recorded.

(Macaunews/ macaupost)

UPDATED: 22 Dec 2023, 5:49 am

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