Oct. 14 (Bloomberg) -- Turkish tax increases on new cars with engines over 1.6 liters will affect the price of 11 percent of cars sold, according to sales data for the first nine months of the year.
About 89 percent of new cars sold in the period, or 366,526 units, had engines of less than 1.6 liters, the Automotive Distributors’ Association’s press office said by telephone today from Istanbul.
Turkey announced the tax rise yesterday to help narrow the current account deficit and increase budget revenue. Turks either buy imported cars or obtain them from the units of companies such as Fiat SpA and Renault SA, which import nearly all parts and assemble the cars in Turkey.
The increases in consumption taxes on cars, tobacco and alcohol were designed to reduce the current account deficit and will avoid penalizing production of locally-made vehicles, Finance Minister Mehmet Simsek said yesterday. The tax rises are aimed at supporting budget revenue, Trade Minister Zafer Caglayan said.
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