Posted December. 28, 2004 22:43,
The government decided to extend cuts in special excise taxes on automobiles for an additional six months. The current excise tax level will remain effective until next June.
This decision reflects the concern that low consumer confidence may have a negative effect on domestic spending without the extension of the excise tax cuts.
The Ministry of Finance and Economy said that the decision was made at a Cabinet meeting Tuesday.
The excise taxes will remain lowered to eight percent from 10 percent on automobiles with an engine capacity of over 2,000 cc until next June, while excise taxes of smaller cars will continue to stand at four percent, down from five percent.
Buyers of Hyundai Motors NF Sonata (1997 cc), priced at 20.6 million won, will continue to save about 250,000 won because their tax burden such as the education tax and the value added tax will not increase to 3.05 million won from the current 2.8 million won.
Consumers who plan to purchase 1,495cc Avante XD will save 160,000 won in excise taxes, 1,998cc SM5-210,000 won, 1,991cc Sportage-220,000 won, 1,911cc Santa Fe-260,000 won and 2,497cc Sorento-560,000 won.
The government also decided to retain excise tax cuts on 12 other big ticket items for six more months. Excise taxes on casino equipment and hunting guns will remain reduced from 20 percent to 14 percent, while excises taxes on deer horn, royal jelly, and perfume also will remain reduced to 4.9 percent from seven percent. Buyers of jewelry, precious metal, expensive cameras, and luxurious watches, fur, carpets, and furniture will enjoy the current six percent tax cuts from 20 percent to 14 percent until next June.