Typically I blog about topics that in someway relate to the offshore/marine industry, but as I have other hobbies as well, I decided to blog about something else for a change. I wouldn’t go that far as to say that cars in general are my hobby. In terms of Top Gear, I probably am not a true Petrol Head. In my humble opinion, most modern cars all were made from the same mould and generally of no interest to me, maybe with a few exceptions.
It is totally different with classic cars, however, as they have unique designs, are very easy to recognise and identify and in general are much more beautiful than modern cars (I know, it is a matter of taste, but still). When it comes to modes of transportation, I fancy old way over modern as a rule of thumb. A steam train beats every electric or diesel train. A classic sail boat (small or large) is more attractive than a new one. Oldtimer planes win in every aspect of modern planes, except in terms of performance and comfort. And all of the above applies to classic cars as well. I think I am kind of addicted to classics: was raised by a dad who owned a classic glider, am living happily with a lady who owns a classic sail boat and am the proud owner of a classic car. But more on that later.
When it comes to cars vs politics, the first is considered to be and endless source of revenues by the latter. In particular in the Netherlands. It starts with buying a car: the actual sales price of a car straight from the factory is penalized with heavy taxing. Initially it was called BPM (tax on personal cars and motorbikes) and up to 2010 the rate was about 40% or higher. Add 19% VAT over the base price and your car has increased in price from the factory to your house with about 50%.
After 2010 BPM was reduced to around 27% in 2010 and to around 11% in 2012. Good news, you would assume, that is making cars cheaper. Errr, not really. Because the reduction in BPM was more than fully covered by an emission tax, effectively making cars even more expensive than before.
So buying a car is heavily taxed. As is owning a car. Because we have road tax as well, based on engine type and weight and also depending on in which province you live. For a large station wagon, diesel, with a weight of around 1700 kgs, road tax is around 450 EUR per quarter. So that adds up nicely for the tax office.
Driving a car is even more taxed, starting off with fuel prices which are amongst the highest in the world and include a tax rate of over 60%. Of every liter petrol selling at around EUR 1.75 per liter, over 1 EUR flows straight to the government.
You think you are screwed by now? Well, you are, but imagine what happens when you drive a company car… If you drive a company car and drive it private as well, 500 is the magic number. If you drive more than 500 private kilometers per year in your company car, you need to add 20-25% of the original price (including the BPM and VAT) to your income, and with an income of 2 x Joe Average’s income, it is taxed at 52%.
Obviously, unless you have a second car for private use, which you will not be able to park in any major Dutch city, the only reason why it is possible to drive less than 500 private kilometers per year, is because commuting is not considered to be private.
Fear struck the approximately 250.000 Dutch car drivers who signed the form “No private driving with my company car” earlier this year, when the politicians announced that commuting would be considered to be private driving from 2013 onwards. On average that would mean a tax increase of 4500 EUR, more than a month’s income for Joe Average. Nett. Fortunately that plan was terminated by the new government.
Which brings me to classic cars. As the proud owner of a 1972 Karmann Ghia, I enjoy driving my car. I enjoy looking at it, washing it, pretend to do some minor maintenance on it and – yes – even filling up the gas tank. There is a financial benefit to classic cars as well – setting maintenance aside for a second – because classic cars of 25 years and older, do not need to pay road tax. They only need to have the obliged technical check (APK) every other year in stead of once a year and if you drive them occasionally, insurance is dead cheap.
Our new government, who decided that it does make sense to pay 11% of your income to health care insurance, came up with the bright idea that classic cars from now on will need to pay road tax, despite the fact that the average classic car is driven for less than 2000 kilometers a year. Imagine what that would do to someone with a few classic cars and on a tight budget: several thousands of EUR a year for cars that hardly see tarmac. And consequently most of those cars will be unregistered and not be seen on Dutch roads ever again.
Fortunately, one of the new minsters does own a classic car himself and is now considering cancelling the road tax for oldtimers that are taken on the road occasionally.
I hope he succeeds, it would make my smile just a little bigger when I take my Karmann out for a drive in summer.