The South Korean government has been pushing for more private vehicles in its country, with the goal of cutting car ownership in half by 2040.
But the government’s new National Car Tax (NCT) could mean a big increase in car ownership.
According to the NCT, every new car registered in South Korean cities will be required to pay an annual NCT of around 10 percent.
This means that car ownership will be capped at 30 percent of income for every person, or about a third of the country’s population.
“If you buy a new car in South Africa, you get taxed on that car’s NCT,” said Kim Min-suk, a senior policy analyst at the Korea Development Research Institute.
“But the government wants you to buy a car and not pay taxes on it, so the tax is going to go up for everyone.”
Kim said that even with the new tax, the NCD will not affect the number of cars being sold in South Koreans.
“You can buy a Toyota Camry in Seoul, and you will still pay taxes because it’s a Toyota car,” he said.
“So the number that will increase will be the number in the market, not the number being sold.”
Kim added that the government has set a target of making South Korea’s car market as “efficient and sustainable” as possible, so there is no reason why car ownership should be capped.
In other words, if the government does increase car ownership, car owners should be able to enjoy higher car prices.
But this means the government may have to cut prices.
“We need to get used to this system and make sure that people pay their taxes,” said Min-sik.
“This is a very big change, but we need to see how it works out.
We need to know how much we pay, how much the car costs, and how much our tax bill will be.”