Brand new is cheaper


THE mass destruction of 20 smuggled luxury cars during the Bureau of Customs’ 116th anniversary was a sight to behold.  This was the first time in the country’s history when a sitting President ordered the condemnation of imported vehicles and watched the wrecking crew crush the high-end cars for everyone to witness.

It was intended to send a strong warning to wealthy motorists and vintage car collectors who do not pay the correct import duties. But did it really have a chilling effect on hard-core smugglers? Many wondered why the Ferraris and Lamborghinis were not around as previously announced. The lame excuse: they were still being processed.

Sayang? Not according to those who reason that anyway these were used vehicles, and their destruction was to prevent them from being auctioned off to the very same people who tried to smuggle them in.

However, an alternative could have been to donate them to the Department of Foreign Affairs for diplomatic use, or to the Department of Tourism for the hosting of international guests.

Meanwhile, luxury car enthusiasts have the option to buy brand-new vehicles at a cheaper price–courtesy of the TRAIN Law.

Buyers who rushed to beat the widely expected increase in vehicle excise taxes were in for a shock when they found out that cars above PHP2 million now have lower prices after the TRAIN took effect. Is this a case of regressive taxation?

Bottom line is to generate more revenues to fund the government’s Build Build Build infrastructure program. Yet these contradictory measures seem to be counterproductive. Was it all for show?