Amman– Traders and importers in the vehicle sector expressed optimism about a promising future for the automotive industry following the decision to implement a new tax mechanism for vehicles.
اضافة اعلان
The new system ensures the regularization of car prices based on a logical and graduated approach, relying on the origin prices for calculating the tax due on vehicles when they are registered.
They confirmed that the decision addresses the needs of the car market, which has been suffering from a lack of clarity in vision and strategy. The sector has long called for a logical equation that would fairly serve both citizens and traders.
According to the Cabinet's decision, a new tax mechanism has been established for electric vehicles, which applies a graduated approach over three years instead of implementing it all at once, as originally planned, starting this year. In addition, the specific tax on vehicles valued below 10,000 dinars (excluding customs) has been fixed at 10% for 2025, increasing to 12% in 2026, and 15% in 2027.
Vehicles valued between 10,000 dinars and 25,000 dinars (excluding customs) will be subject to a specific tax of 30% in 2025, 35% in 2026, and 40% in 2027. Vehicles valued over 25,000 dinars (excluding customs) will face a specific tax of 40%, 45%, and 55% for the years 2025, 2026, and 2027, respectively.
For hybrid vehicles, the specific tax has been fixed at 60% to offer an affordable and moderate option for citizens, while the government has reduced the total tax on gasoline-powered vehicles from 86% to 70%.
Jihad Abu Nasser, representative of the automotive sector at the Free Zones Investors Association, confirmed that the recent changes to the specific taxes on electric vehicles in the Kingdom represent an important step towards stabilizing the market. He noted that cars valued below 10,000 dinars will not be affected by the current taxes, while gradual increases will apply to other vehicles, starting at 2% next year, 3% the following year, and reaching 40% and 55% after two years.
He highlighted that the estimated value of the vehicle before customs duties will remain the basis for calculating taxes, ensuring clarity for both traders and consumers.
Car dealer Hassan Al-Bustanji stated that the decision reflects clarity in legislation, explaining that traders can now predict the market needs or customer preferences in advance. He added that the government's recent decision has fairly addressed both traders and consumers, particularly those with limited incomes who are looking to buy vehicles under 10,000 dinars, which are in high demand.
For his part, importer and owner of a showroom in Amman, Sobhi Estanboul, emphasized that the recent changes to taxes on electric vehicles are a crucial step for stabilizing the market.
He pointed out that the government’s decision to apply a graduated tax mechanism achieves tax fairness for citizens when choosing the category of vehicle they need based on their financial capabilities.
Mohammad Al-Battoush, manager of a car showroom in the Tabarbour area, noted that the decision aligns with the preferences of many low-income customers who are narrowing their options according to their financial capacity, while also helping showroom owners manage their inventory.
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