Why is your car still expensive even though tariffs have been reduced? An honest explanation from a car dealer

When everyone saw the news that "the United States may reduce tariffs on exported vehicles", many friends who were planning to buy foreign exchange cars began to look forward to it: "Will imported US-standard cars become cheaper? Can I save hundreds of thousands of dollars on the C300 or BMW X5 I bought?"

But as a forex car importer with many years of experience, I want to give you an honest and practical opinion:

? Even if tariffs are really reduced, your car will not necessarily be much cheaper.

Why? The reason is that "the price structure of imported cars has more than one tax type". The real key is:

"The local commodity tax system in Taiwan and the various taxes and fees after importation are the main reasons for the high car prices."

1. How is the total price of imported cars determined? You need to understand "this tax bill" first

The price of a foreign exchange car imported from the United States to Taiwan that is finally delivered to you is not just the price of the car + shipping cost. Let's break down the import cost of a US-spec car worth NT$1.5 million (assuming the C-Class is used as an example):

Key point: Even if tariffs are abolished, you still have to face the huge mountain of commodity tax!

2. Excise tax is the real culprit for the price of imported cars

Taiwan's excise tax rates are based on vehicle displacement, for example:

• 2,000cc or less: 25%
• 2,001–3,600cc: 30%
• 3,601cc and above: 60%

This means:

• For a BMW X5, GLC or large SUV, the excise tax alone may exceed 400,000 to 600,000 yuan;
• Even if car prices are reduced or tariffs are eliminated, the tax will still be levied;
• Moreover, the basis for levying commodity tax is the "duty-paid price" including transportation, which has nothing to do with the original factory selling price.

3. Is the reduction in tariffs useful?

Yes, but not as much as you might think.

✅ Helpful sections:

• Reduce import costs, especially for cars produced in the United States (such as the BMW X3, X5, GLC, etc.);
• It is expected to reduce some of the agency costs and vehicle inspection costs;
• There is an opportunity for car dealers to launch promotional programs to give back to consumers.

❗ Restricted parts:

• Excise taxes still exist and are tied to the price of the car;
• There is still no general agent warranty for foreign exchange vehicles, and there are still barriers to obtaining repairs and parts;
• The price structure will not be fundamentally reversed until the commodity tax and luxury tax reforms occur.

4. As a foreign exchange dealer, my honest advice to consumers:

1. Don't expect that changes in "tariffs" will immediately cut car prices in half. This is only part of the overall cost.
2. When choosing a forex vehicle, you should prioritize:
• Whether the vehicle’s condition is complete and transparent (whether there is an accident record on Carfax);
• Whether the mileage and maintenance records are available;
• Whether the car dealer has real performance and after-sales mechanism;
• Check that the vehicle is handled by professionals to avoid hidden fees.
3. If you want to save tax and worry, you can consider a luxury small-displacement car under 2,000cc, which is currently a more reasonable choice.

V. Conclusion

Tariffs are not the only reason for the high car prices. Goods tax is the key factor that truly determines the selling price of imported cars in Taiwan.

In the future, if the government can adjust the commodity tax structure or provide clearer tax reduction incentives for electric vehicles and low-carbon vehicles, Taiwanese consumers will be able to truly enjoy more high-value-for-money imported car options.