Tax on Luxury Vehicle Imports Cut in Half
During the coming week, the price of "luxury" cars will decrease as the import tax goes from 30% to 15%. The Ministerio de Hacienda (Revenue Ministry) said yesterday that the government decree is ready but had no date for it's publication.

The cars affected by the change will be "hybrid" vehicles.

In Costa Rica the only Hybrid vehicle imported is the Toyota Prius, imported by Purdy Motors and certain scooters.

What the reduction means in real terms is that the Prius that now sells for ¢18 million colones (us$36.600) will sell for ¢2.7 million colones less.

The reduction in the import tax is an agreement negotiated between the various government ministries: Hacienda, Ambiente y Energia (Environment and Energy) and Obras Públicas y Transportes (Public Works and Transport).

Importers of used cars consider the move discriminatory since it the change only favours one make of vehicles. José Carballo, president of the Cámara Costarricense Automotriz, that cars like the Prius wil not make much of a difference to the environmnet since there are and won't be many around because of its cost. "There exist other measures to reduce gas emissions and economize gasoline consumption" said Carballo.

Luis Mastroeni, marketing manager at Purdy Motors, assures that his company is importing the Prius for commercial interest and to support environmental concers. "We believe this (the Prius) a solution to the high gasoline consumption and gas emissions", Mastroei said.


How does a hybrid automobile work?
Hybrid vehicles combine a traditional internal combustion engine with a battery-powered electric motor to provide increased gas mileage and thereby lower emissions.

The gasoline engine and the electric motor each utilize their strengths and supported by the other in its weaknesses. This is due to the fact that their engines can operate at a low enough number of revolutions to give good fuel efficiency and make the purification of exhaust gas relatively simple.

It is also no longer necessary to go to the trouble of recharging the batteries at a fuel station.