Road tax

Road tax, known by various names around the world, is a tax which has to be paid on a motor vehicle before using it on a public road.

All states and territories require annual vehicle registration fee to be paid in order to use a vehicle on public roads; the cost of which varies from state to state and is dependent on the type of vehicle. The fee is colloquially as rego (pronounced with a soft g, short for registration).

Passenger cars pay a registration fee based on the engine displacement and power output (degressive towards 2014 (66% in 2012, 33% in 2013, 0% in 2014) and environmental criteria such as CO2 g/km output (increasingly towards 2014). The more CO2 g/km the car produces, the higher the fee will be. (https://belastingen.fenb.be/vfp-portal-pub2-web/simulatieVerkeersbelasting.html#/q/top). Every year, the plate number owner has to pay the annual road tax contribution. This tax is based on the engine displacement (0-799cc = fiscal HP 4, above 800cc per 200cc 1 class higher) (http://koba.minfin.fgov.be/commande/pdf/Fold_verkeersbelast_2010_2011.pdf). Due to CO2 based regulations, diesel cars with above average displacement (>2000cc) are favorised, and petrol cars with bigger displacements are put at a disadvantage). A supplementary annual fee has to be paid for cars that run on LPG/CNG (0-799cc: €84/year, 800-2499cc €148/year and >2500cc €208/year) to compensate financial loss for the state due to the absence of excise at the pump.

In Brazil, the states may collect an annual Vehicle Licensing Fee (Taxa de Licenciamento Veicular) which has a fixed value for each vehicle category determined by each state. In addition, each state may impose a Vehicle Property Tax (Imposto sobre a Propriedade de Veículos Automotores), with a rate up to 4%.

The Costa Rican car property tax, commonly referred to as "Marchamo", is among the highest in Latin America, with rates that can go up to 3.5% off the fiscal value of the vehicle yearly. When compared to the Costa Rican minimum wage ($553.57), an average $15.000,00 car can cost 80% to 120% from a month salary a-year. Even though Costa Ricans receive a yearly bonus equivalent to a month salary, the property tax makes this bonus inexistent for most car owners, which has led to a significant opposition looking for tax law reforms.

Opponents to the car property tax argue, that common cars already pay 100% tariff when imported, meaning that a car in Costa Rica is twice as expensive as in the country of origin. Additionally, gas refills include 65% fuel tax. Owning a $7,500.00 car (U.S. price) for 7 years, can make the user pay up to $29,595.00 in total taxes (around $4,227.85 a year). And it get worse, because el Ministerio de Hacienda has the right to step up the fiscal value of a car, making it a negative depreciation, with no few errors (http://www.crhoy.com/archivo/hacienda-corrige-valor-fiscal-en-20-de-los-vehiculos-acepta-error-en-costo-de-mercado/nacionales/)

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