Who is exempt from used vehicle taxes? - Guideline/Taxes responsible for passing 25% of income to municipalities
The Ministry of Finance has approved a new instruction that brings significant changes to the implementation of national taxes, affecting both the method of distributing tax revenues and the rules for paying used vehicle taxes.
Referring to the instruction published in the Official Gazette and already in force, one of the most important changes is related to point 3 of the instruction, which defines the cases when the used vehicle tax is not paid.
According to the new rules, vehicles that have been blocked or seized and left in storage by court or prosecutor's decision for the period in which the vehicle or vehicle documentation has been blocked are exempt from paying the used vehicle tax; stolen or lost vehicles and vehicles destroyed by accidents, when this is confirmed by the prosecution authorities.
So, unlike before, now those citizens whose vehicle documentation has only been blocked will also be exempt from taxes.
According to the instruction, tax payments for vehicles blocked or left in storage by decision of the court or the prosecutor's office, for the period in which the vehicle or vehicle documentation was blocked, and tax payments for vehicles stolen, burned, destroyed by accidents, certified by the prosecutor's office, are exempt from paying the annual tax and the initial registration tax for luxury vehicles.
The instruction also changes the method of redistributing the revenues collected from this tax to local governments.
Specifically, from the monthly amount of collections from the Used Vehicle Tax, the General Directorate of Road Transport Services, after withholding the commission at the rate of 5% of the total monthly collections, pays the remaining difference of 95% to the bank account of the General Directorate of Taxes (DPT), within the 15th of the following month.
The DPSHTRR sends information to the Ministry of Finance on the taxable value to be distributed according to local self-government units (25% and 95% of the total monthly collections from this tax, within the 15th of the following month.
The Ministry of Finance will send the taxable value to the General Directorate of Taxes to be distributed among the municipalities. The General Directorate of Taxes transfers the taxable value of the income to the local self-government units and the rest remains in the state budget.
The DPSHTRR calculates and transfers to the account of the General Directorate of Taxes the amount of revenue from the tax collected of 95%, after deducting the value of the 5% commission that they benefit from.
In the previous instruction, it was the duty of the DPSHTRR to calculate and transfer to the account of local government units the amount of income that is due to these units from the collected tax, a responsibility that now passes entirely to the tax administration.
This mechanism aims for a clearer and more transparent division of revenues between central and local governments.
These changes aim to increase fiscal transparency; strengthen cooperation with local governments; and ease the financial burden on citizens in cases where the vehicle cannot be used for legal reasons.
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