It’s easy enough for most people to say that luxury goods should be taxed heavily, but that’s only because they themselves don’t have to deal with it. As for those who are interested in purchasing luxury goods, specifically a luxury car, then you’ll have to take a closer look at luxury car tax (LCT) and why people from the automotive industry tend to call for its abolition every now and then.
For those who are not that familiar with luxury car tax, then there are five things you may want to know about that Mercedes Benz tax.
What Luxury Car Tax is
Most of the time, luxury car tax is imposed on whoever is selling the car, but distributors tend to pass it on to the buyer. Luxury car tax is specifically applied to cars that reach a price threshold deemed to be the high end, and that threshold is subject to change depending on market and economic conditions.
Cats motor tax is usually charged on vehicles under two years old, although second hand luxury cars can have tax credit for the entire amount of the luxury car tax. Therefore, unless that car actually increased in value during that time, you won’t have to pay luxury car tax for a second hand luxury vehicle.
How is it calculated?
Here in the Philippines, it’s the upper bracket of what’s officially called Excise Tax for automobiles and other motor vehicles, and it has its own percentages apart from other taxable goods. Luxury cars are classified as those priced at PhP 2.1 million and over.
The excise tax rate for vehicles in that price range is PhP 512,000 plus 60% in excess of PhP 2.1 million. For example, you’re buying a car that’s priced at PhP 3 million, so that’s PhP 512,000 plus 60% of PhP 900,000, which is PhP 540,000. The total amount of excise tax for that car is PhP 1,052,000.
That does seem excessive, and that doesn’t even include other expenses to purchase and own that car like registration and such. That’s why you have to think carefully and plan ahead when considering the addition of a luxury car in your garage, even if you’re the luckiest person in the world who just won the lottery.
Just remember that 60%. It’s quite steep, and the PhP 512,000 flat rate for a car priced at PhP 2.1 million means you have to spend at least PhP 2.6 million for a “luxury” car. Most cars at that price range aren’t even strictly considered “luxury” in the first place, so you have to shelf out even more for a car that can actually be put in the luxury category.
Can I Get Exempted from Paying Luxury Car Tax?
This is pretty much the first question that comes to mind when dealing with any kind of tax. No one likes the tax man, no one invites him for Christmas dinner, and everyone makes it hard for him to do his job. Exemptions for luxury cars are few and far between, but they do exist.
There is mention of tax-exempt luxury cars in the Revenue Memorandum Circular no. 69-2004 which are registered or owned by Diplomatic Mission and Consular Offices or Officials, its officers, administrative staff, and technical staff members. There’s more information on this in Republic Act No. 9182, which is Special Purpose Vehicle Act of 2002 that details tax exemptions and fee privileges for special purpose vehicles.
So unless you’re a diplomat or maybe an official in a recognized religious organization like the Roman Catholic Church or such, then you’ll have to pay luxury car tax for that dream car you’ve always wanted.
Why There’s Luxury Car Tax
The luxury car tax is something that persisted throughout history in some form, and it does look like it won’t go away soon as a lot of people tend to think of it as a good idea. The idea of taxing what’s known as non-essential goods is as old as governance in human history, so luxury car tax is simply an extension of that sentiment.
The luxury car tax here in the Philippines is higher compared to other countries due to the current income brackets of the workforce, most falling under what would considered to be sufficient to reasonably purchase a luxury car without taking out a huge car loan. Therefore, those who buy luxury cars here tend to have to deal with a lot more hurdles.
Recent Changes to Luxury Car Tax
With the new administration, there have been adjustments to the taxation here in the Philippines, mostly benefiting low and medium income households. That does mean luxury car tax has increased to cope with the adjustment. The aforementioned formula above is pretty much along the lines of where it is now with the 60% rate, which has been publicly frowned by car companies which had been aiming to improve the local automotive industry for a while now.
About the Author: Kristel Cuenta is a freelance Social Media Manager and an Online Content Specialist based in the Philippines. She helps brands grow & engage on Social Media.
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No More Lost Packages: Amazon Now Confirms Package Delivery By Taking a Photo of Your Front Door
The internet revolutionized the way we shop. Online shopping makes life more convenient. More and more people these days prefer buying things online rather than the conventional way of going into shops.
Shopping online gives you cheaper deals and better deals since the products come to you directly from the seller or manufacturer. Many online shops also offer discount coupons and rebates. One of the largest and most popular shopping websites worldwide is Amazon.
The choices you can find on Amazon is amazing. You can find gift easier with fewer expenses. From books to posters to rare finds, Amazon has it all. However, not all people have great experiences purchasing stuff online. There were items that went missing in action after the delivery man drops their items on the door.
No More Lost Shipments
Most people, at some point, have had to play detective when the item they ordered online just went missing. Although it is stressful at most times, losing the items you paid for using your hard-earned money may just be a thing of the past, thanks to the trial that the online retail giant is rolling out.
To avoid packages going AWOL, Amazon recently completed their Amazon Logistics Photo On Delivery programme in the United States and will be carried out in the United Kingdom soon.
How Does It Work?
The delivery driver would need to take a photo of your front door to help you find the packages easier. This initiate came after the online company bought smart doorbell company ring, a company that records footages of front doors, for a staggering £700 million.
The online retail giant updated its delivery device and app being used by their delivery personnel. All logistics drivers can now take photos of your home. These photos are loaded onto the Amazon server and drivers and deliverymen don’t have access to them.
— Heather (@Heather_PLS) September 7, 2017
Once the package arrives, the customer will receive a photo along with a notice of delivery. That notice includes a photo of your door with the package lying on the floor.
If you think it is invading your privacy already or adding the photos is a little too much, you can opt to have this additional service removed from the Amazon’s website.
On the “Your Orders” section, simply click “Don’t take delivery photos.”
No more lost packages, yes to happy purchases. Do you think this new service from Amazon is good?
Malaysian Boy Quits School to Become a Farmer, Now a Millionaire Who Farms Cows
While most people want to finish their studies to become successful in life, as is the common belief, one student in Malaysia only thought of becoming a farmer. He so wanted to be one that he quit school at Standard 6.
But you can’t become a farmer without capital and if you have no land. So, this young boy, Saipol Azmir Zainuddi, first became a construction worker to earn money.
Saipol’s monthly salary was RM750 ($190) per month but for his first salary, he didn’t splurge on a new gadget or treat his friends to dinner at some popular restaurant in town. Instead, he bought a calf.
Each month, thereafter, Saipol would buy a calf which his father would take care of.
“Although I dropped out of school way earlier than my friends, that didn’t break my spirit, because being a farmer has always been my dream,” he revealed.
“By the time I was 18, I’ve already had 300 cows. During that time, my father and I raised and sold cows to villagers. I saved up all the profit made because it has always been my dream to own a farm.”
At this point in time, he was already finding success as a farmer and had quit being a construction worker but he dreamed of expanding his farm; thus, he took a loan of RM100,000 ($25,600) to buy a 0.8-hectare land for his cows.
With hard work and determination, the poor Malaysian kid became a millionaire! Today, at age 33, he owns at least 30 buffaloes, 700 cows, and 150 goats.
Last year alone, he earned at least RM1 million ($255,900). But what’s really impressive is that he isn’t selfish at all. Even now that he’s attained success, he is willing to share his knowledge with others and readily coaches anyone interested to know how to run a business like his.
While we don’t advocate quitting school, we encourage everyone to follow their dreams because it can lead to success…
Busty Babe in Skimpy Outfit Helps Taiwanese Vendor Quadruple Sales in One Day
These days, there are already a lot of people who are doing business and are taking care of their finances compared with the number in the past. It seems that many have learned that it is not just important to get a job but to also own a business so they can have extra income.
While that is good, this also means that you have a lot of competition now – especially because there are people who simply copy the business models of those they see as going successful. Ever noticed how there are new stalls popping up near or in front of popular shops, selling the same thing?
Well, there’s no law against these people ‘copying’ your business unless you had registered a patent for it; thus, the best thing you can do is to outdo the competition so you can attract more customers. That you can do through providing the best products and services, offering cheaper alternatives, and doing various gimmicks like doing contests or, as one vendor did in Taiwan, hire a busty model to sell at your shop for one day!
There’s a shop selling braised meat in Taichung night market, Taiwan.
The clever owners of the shop decided to hire the model who goes by the name Little Peach on Facebook.
The model arrived at the shop wearing a low cut sweater and skimpy shorts. Her presence at the shop was such a big deal to the customers that the owners admitted to having quadrupled sales that day! Whew!
Little Peach would also proudly post photos of her gig at the braised meat shop – and the post would quickly go viral on social media.
People are now calling her as ‘Braised Sister’ while others are asking where the shop is located so they can also meet up with Little Peach and buy the meat she’s selling…
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