TAX BREAKS A BOON FOR ECO CARMAKERS

       Tax breaks and subsidies on the purchase of eco-friendly cars after scrapping old vehicles are boosting sales of not only hybrids cars but also fuel-efficient petrol driven models.
       Due to the impact of the tax break in promoting the sales of new cars, auto-makers have been working to improve the fuel efficiency of their petrol vehicles to ensure they qualify for the tax-reduction scheme.
       In August, Toyota Motor improved the fuel efficiency of some models of its Vitz subcompact car. As a result, it qualified for a purchase and weight tax reduction of 75 per cent, up from the 50 per cent it could previously claim.
       Sales of Vitz climbed steeply to 12,731 in September, a 27.7-per-cent rise on the same month last year.
       Tax breaks for eco-friendly cars were introduced in April, with a spring 2012 time limit set for the scheme.
       Under the scheme, consumers who buy new electric, hybrid and clean diesel cars are exempted from automobile acquisition and weight taxes. But petrol-fuelled car buyers also are entitled to a 50 per cent to 75 per cent tax reduction on cars that meet certain fuel efficiency and emissions criteria.
       When a car owner scraps a vehicle that was first registered more than 13 years ago and purchases an eco-friendly car that meets certain criteria, he or she receives a subsidy of 250,000 yen (Bt92,730) if scrapping a family car, including a midsize and subcompact car, and a subsidy of Yen125,000 if scrapping a microcar. The subsidy scheme is set to expire on March 31.
       Some Vitz models do not qualify for the tax-reduction scheme. However, for the models that qualify for a 50 per cent or 75 per cent tax reduction, car buyers can save between Yen59,900 and Yen90,000 in acquisition and weight taxes. It gives consumers an incentive to choose certain Vitz models rather than other petrol engined cars that do not qualify for the tax break.