European licence plates: How does Samopomich see the solution to the problem?

The problem with the cars having European registration arose not because people did not want to pay duties for them, but because of the fact that in many cases the amount of the tax rate exceeded the cost of the car itself.

MP Roman Semenukha explains that all the fees that a person has to pay when importing a car comprise four components. The value-added tax and the customs duty are the two components which, according to the Samopomich faction, cannot be changed. The third one is a payment to the Pension Fund, and the fourth – an excise duty.

In its alternative bill, the Samopomich parliamentary faction suggests significantly reducing the excise duties for new and used cars (other than large-scale vehicles) and cancel the non-relevant tax to the Pension Fund.

Affordable prices for everybody

The aim of the draft law of Samopomich is to reduce the total cost of customs clearance, which should make no more than 50% of the car’s value, or about 1000 euros for the most popular cars (price category of 3-4 thousand euros), through the reduction of excise taxes and the cancellation of the tax to the Pension Fund.

For example, the cost of customs clearance of a 15-year-old car with a 2-litre engine at a price of 2,000 euros will make 1,000 euros. The total cost of the car in Ukraine will be 3,000 euros (in accordance with the bill 8488 authored by Nina Yuzhanina, it will make up 4,500 euros)

The customs clearance of a 15-year-old car at a price of 3,000 euros with a 3-litre engine will be 1,320 euros. The total cost of the car in Ukraine will be about 4,700 euros (in accordance with the bill 8488 authored by Nina Yuzhanina, it will make up 6,800 euros).

In addition, Samopomich offers to give people the opportunity to import Euro-4 eco-standard cars by the end of 2020 and to keep the zero VAT rate for electric vehicles by the same time. At the same time, large excise rates should be kept for the cars imported from the territory of the aggressor country – Russia. None of these things are provided for in the main bill by Nina Yuzhanina.

To contain the crisis

With regard to the cars that have already been imported to Ukraine but have not been cleared. In accordance with the draft law of Samopomich, the owners of the cars with foreign licence plates will get an opportunity to undergo a simplified procedure of customs clearance and to register their cars (European standard not lower than Euro-3) in Ukraine by 2019.

This will allow legalizing such cars in Ukraine. Ukrainians will become legal owners and will bear all responsibility for the actions with their cars. Moreover, if 400,000 people (the official data on the number of cars with foreign registration) get this customs clearance, according to preliminary estimates, the budget will receive 19 billion hryvnias. And if there are actually about 2 million of such cars in Ukraine (according to activists), the budget can receive 96 billion hryvnias of additional revenues.

The law is not about foreign licence plates, but about affordable cars

Samopomich suggests reducing excise duties for good, so that people will not have to humiliate themselves by violating the law anymore and will be able to buy cars legally at affordable prices and register them in Ukraine.

“That is, we offer to generally reduce the excise duty, not only for used vehicles but also for new ones. Therefore, our bill is not only about foreign licence plates; it is designed to improve the life of every citizen of Ukraine, because it will make cars more affordable.

And it is very good that today people are gathering outside the parliament with demands to resolve the problem. Because this Verkhovna Rada has a tendency of making decisions in the interests of people only under the pressure of these very people,” concludes Roman Semenukha.

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