Romania’s second hand car imports soared 85 percent to 175,000 in 2012 on tax cut

The government decision to cut the pollution tax by 30 percent saw the imports of used cars grow by an impressive 85 percent last year to 174,950, but the implementation of an environmental stamp in January reduced sales announcements for cars registered before 2007.

More than 124,000 cars registered abroad are currently travelling on Romanian roads, out of which 24,000 are registered in neighboring Bulgaria, according to Adriana Ahciarliu, general secretary of the Association of Financial Companies (ALB). She explained this was due to the various taxation mechanisms enforced by authorities, ranging from the first registration tax to the pollution tax.

The leasing market has been hit during the crisis and stabilized in the past two years.

“On the backdrop of a stable political and fiscal year, we expect a three percent expansion of the market,” said Ahciarliu.

The environmental stamp, which cuts the taxation of cars fitted with older engines, is based on the same scheme as previous versions of the pollution tax and only the calculation mechanism has been changed, according to  Attila Okányi, COO at Allegro Group Romania, whose portfolio includes the car trading portal autovit.ro.

Read more about

Air Show in Bucharest on Saturday for Aviation Day: dozens of military aircraft to fly over Aviatorilor Square

read more

“The sales of new cars will not benefit as a result of the environmental stamp, as the amount for EURO 3 and 4 engines will not change dramatically, and the competition of new cars are the EURO 5 cars, for which the stamp remains at a similar level,” said Okányi. He added the government will not collect more taxes from the stamp, because the focus is on additional funding originating from the stamps of the buyers of already registered cars, for which no such tax as been paid until now.

He suggested as a viable alternative the enforcement of an annual taxation regime for highly polluting cars, which would push owners to get rid of them. At present, drivers stick to their older vehicles, because any potential sales would  wipe out a significant amount from the sale price.

The sales boom of second-hand cars in Romania runs a dangerous cost for the drivers, according to Eugen Maciuca, manager of AAA Auto New Kopel, a second-hand dealership.

He said that second-hand cars purchased from independent resellers raise challenges for consumers, specialized dealers and financing institutions.

“From our point of view, the imports from Germany, France and the Netherlands, can’t be profitable without fraud,” said Maciuca. Fraud in the second-hand market can be carried out through altering the mileage, hiding the real technical condition, or forging the service card.

AAA Auto New Kopel estimates that, locally, mileage altering accounts for tens of millions of euros in fraud, given the size of second-hand imports.

Ovidiu Posirca