Guatemalan importers of used vehicles are contemplating filling a lawsuit, based on the inconstitutionality, against the First Registration Tax (known as Iprima) which came into force since on July 1st 2012.
Claiming that the tax is inequitable, in the course of this week the Union of Used Vehicle Importers, expects to file an appeal against three paragraphs of Article 109 of the Iprima Act.
The Ministry of Finance in Guatemala has accepted demands made by the Union of Used Vehicle Importers and announced changes to the draft Tax Update.
The government has backtracked on its plans for fiscal reform in light of strong reactions from used-vehicle importers. They suggested using the same system for calculating the tax on entry of used cars into the country, and permitting entry of used cars up to 15 years old, rather than the 7 years proposed by the Ministry of Finance.
The recently approved tax reform seriously affects operating conditions for this market.
The recently approved tax reform prevents vehicles which are more than 7 years old from being imported and establishes a tax known as First Registration of Vehicles (Iprima in Spanish), representing a rate calculated on the estimated market price and not the import price.
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