-- -- -- / -- -- --
إدارة الموقع

These Are The Conditions For Continuing Auto Assembly Plants

Echoroukonline
  • 421
  • 0
These Are The Conditions For Continuing Auto Assembly Plants

In the supplementary finance bill 2020, the government approved a package of measures aimed at encouraging the industrial handling sector and supporting industrial integration, contradicting previous policies that encouraged installation areas with the approval of fiscal and customs exemptions without economic returns and no social repercussions, according to government estimates.

According to the supplementary finance bill, the new strategy of the government has removed all benefits and facilities that were inherent to the activities of installing cars, electromechanical devices, mobile phones, and other installation activities, by imposing customs rights at 15 percent and drawing on value added by 19 percent, thus the government has removed The differential system.

However, it did not prevent the installation activity, i.e., meaning that the owners of auto installation factories if they preferred to keep them, they only had to pay 34 percent as fees for the public treasury, and in return the government allows economic agents active in the field of installation and assembly.
Furthermore, there’s the possibility of benefiting from a reduction in customs rights to 5 percent in the case of their commitment to a percentage of national integration, to be specified in the books of conditions for their branches of activities.

In a related development, the mandatory lifting of the industrial sector was decided immediately after 3 years imposed on the exclusive distributors of tourist and utility vehicles, and in return the increase in the rates of customs rights and the fee for new imported cars, with the aim of reducing car imports in addition to finding additional financial resources for the public treasury.

The handling companies and the producers of local parts and spare parts, against the background of the procedures approved in the project, benefit from a preferential system on the basis that the upstream activity as it constitutes a necessary factor to expand the circle of integration in industries including the automobile and vehicle industries as well as electronic products.

Among the measures included in the Supplementary Finance Bill 2020 is the guarantee of an exemption from customs rights and a fee on the added value of raw materials and imported parts for the benefit of local handling companies active in the field of synthetic production directed towards mechanical, electronic and electromechanical industries and equipment, as well as tax exemptions for a period of 5 years.

This new approach would place the handling industries at the forefront, contrary to what was previously done with the granting of a preferential system for the installation industries – CKD, S-Caddy in the Finance Act 2017, which left significant losses to the public treasury either in terms of tax revenue or Customs revenue without achieving the goals that were sought from such synthetic industries, whether in terms of integration rates, economic returns, abundance, and the price of the product.

According to the justifications outlined by the supplementary finance bill, the government considers that the installation and assembly activity in Algeria, including vehicle installation, showed that the production path is limited to installation with a very weak national integration rate, and its survival and continuity will not result in any real added value, especially since installation activities have benefited from fiscal and customs incentives without achieving significant integration rates after years of activity or even transfer of technology, installation projects benefited from customs exemptions and reduced rates for drawing on value added by 9 percent.

Add Comment

All fields are mandatory and your email will not be published. Please respect the privacy policy.

Your comment has been sent for review, it will be published after approval!
Comments
0
Sorry! There is no content to display!