Budget: Will green cars be cheaper?

Johannesburg - What impact will the Budget have on prospective car buyers?

A Fin24.com users writes: "I am a 26-year-old and want to buy my first car. My income is in the tax bracket of between R150 000 and R221 000.

"Please can you give me more information about the so-called green tax?

"Should I buy a second-hand car, which would mean no tax? Or should I buy a fuel-efficient car, will my instalments be tax deductable?"

Charles de Wet, director of PricewaterhouseCoopers, responds:

"The proposed carbon dioxide vehicle emissions tax is a tax that will be levied on new passenger vehicles with effect from September 1 2010.

"The tax will be based on the certified CO₂ emissions of the car at R75 per gram of carbon dioxide per kilometre driven (g/km), for each gram/km above 120 gram/km.

"If, therefore, the certified CO₂ emission of the new car you purchase is not more than 120 g/km, if you purchase a new vehicle before September 1 2010 or buy a second-hand car, this proposed tax should not directly affect you."

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• Tax: Gordhan giveth, taketh away
• Calculate your tax saving
• Gordhan 'demands pound of flesh'
• Gordhan: Tax hikes in next budget.

- Fin24.com

• PricewaterhouseCoopers Southern Africa provides industry-focused assurance, advisory and tax services.