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In the context of plans to introduce a car registration tax from next year, Business of the Day looked at the situation in the Latvian car market. The age of cars registered for the first time in Latvia is at least 11 years and most of the cars registered in Latvia run on a diesel engine, according to the data provided by the Road Traffic Safety Directorate.

In 2019, the number of cars registered in Latvia for the first time, which had 11 or more years, accounted for 48.5% or they were 33,009 cars. In turn, brand new cars registered for the first time, up to 2 years of age, accounted for 28.1% or 19,118 cars. 6- to 10-year-old vehicles accounted for 17% of first-registered cars, or 11,595 cars. The smallest share was made up of 3 to 5 year old cars – 6.4% or 4352 units. In total, the number of cars registered for the first time last year was 68,074.

The data provided by the CSDD show that in the period from 2004 to 2019 the lowest number of cars registered for the first time, aged 11 or more, were registered in 2007, when they were 26.3% or 28,192 of the total first time in Latvia. number of registered passenger cars. In the following years, the number of such cars tended to increase.

If you look at the number of cars registered for the first time by brand, then last year the most popular were Volkswagen (10,891), Volvo (8274), BMW (7155), Audi (7030), Toyota (5448) and Opel (3795).

Last year, the following passenger cars were registered for the first time in Latvia – “Infiniti” (25), “Ssang Yong” (26) and “Tesla” (41). In total, 44,604 of the cars registered for the first time last year were 5 or more years old, while 23,470 cars were up to 5 years old.

Data from the Road Traffic Safety Directorate show that as of 01.01.2020, 727,164 passenger cars were registered in Latvia, of which 447,468 engines were diesel fuel. The type of these engines is growing every year in Latvia. In turn, 230,506 cars in Latvia run on a gasoline engine.

The third most popular type of engine is petrol and gas – 27,828 cars were registered in Latvia at the beginning of this year. The popularity of this type of engine in Latvia is decreasing every year. 90.4% of the owners of these cars are natural persons, while 9.6% are legal entities.

Already reported that from next year with the aim to prevent the registration of old and environmentally unfriendly cars, it is planned to introduce a car registration tax in Latvia, envisages the amendments to the Law on Vehicle Operation Tax and Company Car Tax, supported by the Cabinet of Ministers (CM) on 31 September.

The Ministry of Transport explained that the purpose of the amendments is to balance the vehicle operation tax rates for passenger cars and trucks with a maximum weight of up to 3,500 kilograms and the procedure for their calculation, as well as to determine the bus and truck vehicle operation tax calculation procedure according to their engine emissions.

The draft law also envisages the introduction of a new car registration tax, with the aim of preventing the registration of old and ecologically harmful cars in Latvia.

Car registration tax rates are determined depending on the type of fuel of the car. The aim is to promote the market for “clean” and energy – efficient vehicles, taking into account their lifetime impact on energy and the environment, including energy consumption and emissions of carbon dioxide and certain pollutants such as nitrogen oxides, non – methane hydrocarbons and particulate matter.

The Saeima has yet to decide on amendments to the law.

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