Langley, BC – The New Car Dealers Association of BC says Budget 2024 includes many initiatives aimed at addressing the issue of affordability for British Columbians – but suggests the same philosophy should extend to the application of the New Car Luxury Tax and ensuring zero emission vehicles remain as affordable as possible.
The NCDA says when BC’s New Car Luxury Tax was introduced in 1997, the intention was to target buyers of high-end vehicles. However, the Tax has not been adjusted for inflation for several years. As a result, while the average cost of a new vehicle in Canada is approximately $66,000 – the BC tax kicks in at a $55,000 purchase price.
“Our concern and one increasingly raised by working families across BC is that the New Car Luxury Tax applies to vehicles that are in no respect a luxury item,” says Blair Qualey, President, and CEO of the NCDA. “This tax applies to the practical vans or SUVs that families rely on to shuttle their children to soccer or hockey, or a pickup truck that may be required for work.”
The NCDA suggests BC’s New Car Luxury Tax presents another layer of taxation on BC residents who already face considerable cost of living challenges and has consistently recommended the Luxury Tax threshold be raised and eliminated over time.
The New Car Dealers Association is also registering growing concerns about affordability as it relates to the cost of zero emission vehicles, in the face of mandated targets that will requiring automakers to meet an escalating annual percentage of new light-duty Zero Emission Vehicle (ZEV) sales and leases – reaching 26% of light-duty vehicle sales by 2026, 90% by 2030, and 100% by 2035.
“While the next overall mandated target is within striking distance here in BC, the longer-term implications are of greater concern,” continued Qualey. “Early adopters of ZEVs didn’t require a great deal of convincing, whereas the broader consumer population will, largely because of price, but also as a result of concerns that include range anxiety, and charging considerations, especially if they live in remote areas where charging infrastructure is limited, and the weather is much colder.”
The NCDA is proud to administer the CleanBC Go Electric Passenger Vehicle Rebate Program since 2011, but in the face of mandated targets, ongoing and predictable funding that helps make the cost of ZEVs affordable is paramount. Likewise, significant, and ongoing investments to build fast charging stations that will ensure British Columbians can access charging where they live, work and play – are critical.
The Association acknowledges a government commitment to investments of $30 million to continue building electric vehicle public charging infrastructure across the province, but suggests the required charging infrastructure required to support the levels of ZEV sales required in Legislation must ramp up significantly between now and 2030,when 90 percent of new vehicle sales must be ZEVs.
BCs New Car Dealers want to be part of the solution in keeping the economy moving in the right direction. To that end, the NCDA will continue to advocate for policy and funding decisions that help encourage consumer spending and support jobs and incentivize consumers.
About the NCDA: The New Car Dealers Association of BC (NCDA) represents over 400 new car and truck dealers throughout British Columbia who employ 30,000 British Columbians and are responsible for close to $17 billion in retail sales in the province. The Association speaks on behalf of the retail automotive industry and advocates on legal, environmental, and consumer issues relating to vehicle sales in British Columbia.
