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  • Leanna Kairua

Cook Islands Customs Public Consultation – Tariff concession and Value Added Tax (VAT) Exemption for the Importation of Disability Motor Vehicles

Introduction


The Revenue Management Division (RMD) of the Ministry of Finance and Economic Management has commenced a public consultation for a proposed amendment to the existing tariff concessions under Part 2 of the Customs Tariff Act 2012. The proposal is to introduce a tariff concession and VAT exemption for imported motor vehicles designed or adapted to transport disabled persons into the Cook Islands. This will make these motor vehicles “free” of import duty and VAT upon importation.


Deadline for Feedback: 4pm on 31 May 2024.


Consultation Feedback


Feedback should be sent via email to RMD at customs.info@cookislands.gov.ck and elizabeth.tetauru@cookislands.gov.ck. Requests for additional time to provide submissions will be considered on an exceptional and limited basis only. Any such request must be submitted by email to Maria Matua-Ioane (maria.matua@cookislands.gov.ck) and Elizabeth Tetauru (elizabeth.tetauru@cookislands.gov.ck) before 4 pm on 20 May 2024.


Why create a tariff concession and VAT exemption for imported disability motor vehicles?


The Cook Islands Government acknowledges that the current import duty and VAT imposed on motor vehicles designed or adapted to transport disabled persons may not serve the best interests of the Cook Islands and its citizens, particularly those with disabilities. The imposition of these tariffs and VAT, in effect, is a barrier for foreign sourced motor vehicles designed or adapted to transport disabled persons being imported into the Cook Islands.


Only a small number of motor vehicles designed or adapted to transport disabled persons have been imported into the Cook Islands over the last decade. By implementing a tariff concession and VAT exemption, the Cook Islands Government and the private sector can make these motor vehicles more affordable and accessible, thereby promoting inclusiveness for those living with disabilities. This could also bring potential economic benefits, such as increased employment rates among individuals with disabilities and for the promotion of tourism to the country for people living with disabilities.


What is the effect of the tariff concession and VAT exemption for imported disability motor vehicles?


The effect of the proposed tariff concession and VAT exemption would mean that motor vehicles designed or adapted to transport disabled persons would not be subject to any import tariffs or VAT on arrival in the Cook Islands. This change aims to make these motor vehicles more affordable and accessible for individuals with disabilities, thereby promoting inclusivity and potential economic benefits.


How the tariff concession and VAT exemption for imported disability motor vehicles will be implemented?


The proposed tariff concession and VAT exemption will be implemented by inserting a specific concession for disability motor vehicles into the Ships, motorcycles and motor vehicle concession items in the Part 2 Concessions of the Cook Islands Customs Tariff Act 2012.  The importation of disability motor vehicles will become exempt from VAT by inserting an exemption into clause 4 of the Second Schedule of the Value Added Tax Act 1997


The proposed tariff concession and VAT exemption will apply to motor vehicles designed or adapted exclusively for the use by individuals with disabilities. It is intended that any modifications made to a motor vehicle will be tailored to aid the individual in coping with their specific disability. These modifications can encompass features like wheelchair ramps, customised controls, or alterations for improved accessibility.


What is the anticipated date of implementation?


The anticipated date that the changes will come into effect is 01 November 2024.


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