A Temporary Government Program Ends!

[D'kian]

Back in the 60s the Mexican federal government instituted a "temporary" tax on car ownership, ostensibly to help to pay the cost of the 1968 Olympic Games. 41 years later we're still paying this temporary tax (of course nothign proves more permanent than a temporary government program).

In 2006 then candidate Felipe Calderon promised to abolish the car tax. Three years later we're still paying it. There is a law in the books saying the tax will expire in 2012 (when Calderon's term ends), but it will devolve to the various states, who will decide whether to keep it or not (gee, what do you think they'll do?)

In the meantime, since the car tax is collected by the states and they get to keep the money, the state governments can adjust the rate for now. Well, the state of Queretaro (about a couple of hundred klicks north of Mexico City) has announced for 2009 the car tax rate will be zero.

What does this mean? For the moment it means people who own cars registered in Queretaro won't pay the car tax, but the tax is still alive and kicking. The rate can be changed back at any time. Still a temporary governemtn program ended (sort of).

I'm tempted to buy my next car in Queretaro. I'd save a bundle the first five years on car taxes (if the zero rate holds that long), but I'd have to drive to Queretaro at least twice a year to perform emissions' checks there (there's a mess of environmental laws int he City, which apply differently to out of City cars). There's also a chance the City governemtn will place more restrictions on out of City cars to prevent this kind of thing. We'll see.

It's worth noting Queretaro's governor also announced budget cuts to adjust to the loss of revenue (I estimate it at around $25 million US per year).