Wednesday, 25 November 2020

Costa Rica Vehicles Imports Continues Strong Growth

QCOSTARICA – The import of vehicles in Costa Rica continues to grow significantly. In the first five months of the year a total of 67.992 vehicles, the majority new, were added to the number of vehicles circulating our collapsed roads network.

full-traffic-jam-at-night2
Traffic chaos in the Central Valley is no around the clock: morning, day, night and weekends. Photo from Govisitcostarica.com

Cheap(er) gasoline, which implies an increase in purchasing power and lower prices, a stable exchange rate and accessible credit, are the factors promoting a surge in vehicle ownership in the country.

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Of the almost 68.000 vehicles arriving between January and May of this year, 32.000 were motorcycles. Of the total, 72% of the vehicle imports were new.

Tourist Tips: Avoid Costa Rica Traffic Jams from Javi the Frog!

According to numbers provided by the Ministerio de Hacienda (Tax Department), of the 35.690 autos entering the country between January and May, 25.822 were new (21.321 autos and 4.501 trucks) and 9.868 used (8.966 autos and 902 trucks). Of the 32.308 motorcycles, 31.839 were new and 469 used.

Infographic by La Nacion. Source Ministerio de Hacienda (Tax Department
Infographic by La Nacion. Source Ministerio de Hacienda (Tax Department

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“Demand for new cars has been steady and is benefited by attractive bank loans,”  Allan Sime, marketing director of Purdy Motor Costa Rica (exclusive Toyota dealer in Costa Rica), explained during the last Expomovil.

“The health of the US economy, interest rates, a good economic climate in the country and the relatively stable fuel prices are, among others, some of the factors that favour the purchases,” said Erick Xirinachs, regional marketing director of Grupo Q, the Hyundai dealer in the country.

The increase in vehicle imports is also good for the government coffers. Tax revenues from the imports include import taxes (duties), sales tax (13% applied to the retail price), higher Marchamo (circulating permit that includes property tax on vehicles) based on the tax value, and tax on fuel (some 50% of the price of fuel at the pumps is taxes).

The official Costa Rica tourism website has tips for tourists to avoid traffic congestion.
The official Costa Rica tourism website has tips for tourists to avoid traffic congestion. Click here.

“Obviously everything that means that the (tax) collection grows, it will not be frowned upon by us (…),” said the Vice Minister of Finance, Fernando Rodriguez.

For the tax collectors, the revenue from the imported vehicles for the first five months of the year was ¢130 billion colones, representing 8% of total tax revenue for the period.

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Of course, the negative result of the increase in imports is exacerbating traffic congestion. However, adding more vehicles on the roads is not the only factor.

Leonardo Merino, researcher for the Estado de la Nación, said the problem with traffic congestion is basically the city grew over the last 30 years, with build up areas more than doubling, expanding within the roads instractures built then, that is the same roads now.

Source: La Nacion, Visitcostarica.com, Ministerio de Hacienda

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