At the time, dealerships were hopeful despite government imposing additional 20% green tax on vehicles above 1,800 cc and 5% tax on vehicles below 1,800cc. Announcements at the time didn’t benefit car importers in any manner as policy’s were stringent in regards to zero imports. Now, two year’s later, this ban has been lifted immediately pushed inquiries of prices and spurt of new bookings.
Norbu Wangchuk, Minister of Economic Affairs in Bhutan has made this announcement following new taxation laws in place due to which the ban on import of vehicles has been lifted with immediate effect. Buyers are all heading to company showrooms with bags of cash to make new purchases, however, auto dealers are still awaiting written circulars from the Government prior to them accepting any orders.
Taking vehicle count in the country as on June 2014, total vehicles in Bhutan stood at 68,129 units while Thimpu has registration of 36,265 units. Most new buyers are showing preferences for vehicles manufactured in India. Those buying cars for personal use will only be able to afford Indian cars. Vehicles used in tourism industry wouldn’t be affected adversely as costs can be offset by increasing car rental prices. To understand this better, Hyundai Sante fe imported from Korea will cost about Rs 29 lakhs, and a 1500CC Santro Xing imported from India will cost less about Rs 4.5 lakhs.
New vehicle taxes here point to Bhutanese picking vehicle imports from India as compared to others since tax difference ranges from below 50% upto 125%. Tax revision also impacts light commercial vehicles but not heavy vehicles sales. Vehicles with cylinder capacity at or below 1500cc imported from India entail 55% tax (45% sales tax and 10% green tax).
Vehicles imported from third countries with cylinder capacity at or below 1500cc entail 100% tax (45 % sales tax, 45% customs duty and 10% green tax).
Vehicles with the cylinder capacity between 1500cc to 1799cc entail 115% tax ( 50% sales tax, 50% customs duty and 15% green tax). Vehicles with 1799cc-2500cc, tax imposed is 120%, 2500cc to 3000cc at 125% tax, and over 3000cc, tax imposed is 180%. Tax imposed on hybrid cars would be 45%.
Honda Amaze has been introduced to the country via social media while Dhejung Motors, dealers for Honda in Bhutan have started accepting orders from July 15. Renault vehicles will also be up for sale in Bhutan. Thunder Motors, a company that is well versed with sales of electric cars will soon commence orders for non electric SUVs and for the Nissan Terrano.
Maruti Alto isn’t to be sold in Bhutan, and Alto 800 would be available at a strating price of about Rs 4 lakh. Maruti Celerio replaces A-Star at a starting price of about Rs 5 lakhs. Maruti Omni and WagonR prices will start at about Rs 4 lakh and Rs 5 lakh. Ertiga will also be sold. Toyota Prado (Rs 50-60 lakhs) and Hilux are to be sold in Bhutan. The STCBL deals with Toyota cars imported from Japan and Tata and Eicher from India.