Cars in Argentina cost up to 70% more expensive than in other countries

MAY 04, 2021

Although it is a well-known fact, it is still surprising. Tax pressure means that Argentines have to pay much more for any product than what it is worth abroad.

In the automotive sector, this theory is proven in practice. Of the sale price of each 0 kilometer sold in the country, 54% corresponds to taxes. This is the tax floor. From that level, the tax burden increases, depending on the origin of the vehicles and their positioning in the market.

A good example is the case of the Peugeot 208 GT presented last Monday in the country.

It is offered in two versions with prices of $ 4,454,627 and $ 4,462,545. At today's official exchange rate, they represent about U$S44,900. When compared to other countries, the difference is abysmal. In France, its initial price is U$S28,600, so in Argentina, its value rises 60% for the consumer.

But you don't have to go that far to see the different realities. In Chile, it is available for U$S26,300, i.e., it costs 70% more on this side of the Andes.

It is true that at the "blue" rate its value is lower, about US$29,600, but it is not the exchange rate used to import. In any case, even with this exchange rate advantage, it is still more expensive than in France or Chile.

This model of the Stellantis group suffers from two tax burdens that make the tax burden higher than 54%. On the one hand, as it is a model imported from outside Mercosur - it is produced in Europe - it has to pay a 35% tariff.

The other burden it bears, due to the voracity of the State, is the payment of the first scale of Internal Taxes. Until the end of May, all models above $2,500,000 must pay what is known as "luxury" tax.

This tax has a tax rate of 20% but, due to the way it is calculated, it implies that the prices of the 0km vehicles covered will be 25% higher.

As of June, the taxable base will increase to $2,900,000 in retail value.

The Peugeot 208 is produced in Argentina and, at some point, the possibility of manufacturing these two versions, which are the top of the range, in the country was evaluated, but the company decided not to do so due to the high costs.

The 208 GT and GT-Line are more powerful versions of the model of the French brand. They come with a 130 hp 1.2 turbocharged engine and six-speed automatic gearbox.

Source: MDZ

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