Hong Kong budget: registration tax, licence fees for private cars shoot up 15 and 30 per cent, respectively
- The tax increases – which are effective immediately – were announced by finance chief Paul Chan, who said they would help ease congestion in the city
- The increase in first registration taxes is expected to reduce government revenue as fewer people buy new cars, but the spike in fees is predicted to more than make up for the losses
Hong Kong’s car owners and buyers will now have to shell out more for the privilege of keeping private vehicles after registration taxes and annual licence fees shot up by 15 and 30 per cent, respectively, on Wednesday.
“The number of private cars has been on the rise. Traffic congestion has been aggravating. The first registration tax and the vehicle licence fee for private cars have not been adjusted since 2011 and 1991, respectively,” he said.
The increases, effective from 11am on Wednesday, pushed the first registration tax for newly purchased private cars to 46 per cent of the first HK$150,000 of the vehicle’s taxable value, 86 per cent of next HK$150,000, 115 per cent of the next HK$200,000, and 132 per cent for any remaining taxable value.
For existing private cars, annual licence fees rose by 30 per cent to anywhere between HK$5,074 and HK$16,592, depending on the vehicle’s engine capacity. For electric cars, the base licence fee increased to HK$572 for the first tonne of unladen weight. The fee for each additional 250kg will remain at HK$124.