In the U.S., the Auto Care Association (ACA) is warning vehicle owners face a “significant” increase of about US$160 per year in repair and maintenance costs if a proposed Border Adjustment Tax (BAT) under the Trump administration, goes through.
“The Border Adjustment Tax will drive up auto repair costs to about US$1,100 per year for car owners,” says Bill Harvey, the ACA’s president and CEO. He adds, it’s a “highly regressive tax” that will hit middle- and lower-income families the hardest because they tend to drive older vehicles that need more repairs and maintenance. According to the ACA, the average age of a vehicle on American roads is 11.6 years.
The association says the BAT will drive up repair and maintenance costs because it would impose a new 20% tax on imported goods and services. It would mean a US$20-billion per year tax increase on automotive parts. That increase would be passed on to customers by repair shops.
The ACA says this proposed tax is “ill-conceived” and would hurt auto service businesses and their customers alike.