CURRENT legislation in Cyprus discriminates against imported motorcycles and laws must be changed, the European Commission said yesterday.

The Commission yesterday formally requested Cyprus to amend its legislation on depreciation scales for the calculation of excise duties on second-hand motorcycles.

“The Commission considers that the current legislation is in breach of EU rules on tax discrimination against products imported from other Member States,” a statement from the Commission said.

The request takes the form of a ‘reasoned opinion’ – the second step of the infringement procedure.

In the absence of a satisfactory response within two months, the Commission may decide to refer Cyprus to the EU’s Court of Justice.

Under current Cypriot legislation, owners of second-hand motorcycles have to pay an excise duty depending on the depreciation of these vehicles, ie their loss in value over a certain period of time. However, the Cypriot legislation only takes into account the criterion of age when calculating the duties and limits it to 10 years.

In practice, a motorcycle that is two or three years old would depreciate at almost the same pace as a motorcycle aged four or five years old and depreciation for vehicles aged fifteen or twenty years would remain the same as for vehicles ten years old.

“Such a system could result in higher taxation for second-hand motorcycles imported to Cyprus than for those already registered in the country and is therefore in breach of EU rules on tax discrimination against products imported from other Member States,” the Commission said.

THE EU is promising to end the ‘bureaucratic nightmare’ of registering cars in another member state or registering a car in a country of residence that was bought abroad.

“What should be a simple procedure often turns into a bureaucratic nightmare, with cumbersome re-registration formalities and paperwork,” the Commission said in a statement yesterday.

According to the Commission, member states require that cars that are permanently on their territory to be registered via local authorities and according to national rules that are applied in an uncoordinated manner across the EU.

With the aim of simplifying this, the European Commission yesterday launched a public consultation to identify the main difficulties encountered by EU citizens and companies when moving a car bought and registered in one member state to another.

The consultation will provide insight into the views of citizens and other stakeholders on car registration issues and shape actions to remove yet another obstacle to the free movement of goods and services.

European Commission Vice-President Antonio Tajani, Commissioner for Industry and Entrepreneurship said: “Buying a car in one member state and then moving it to another should not be complicated. This public consultation will provide us with a better understanding of the problems encountered by citizens and companies, and with ideas on how to improve the situation. Our aim is to save time and money for consumers and businesses as well as for national registration offices.”

“Citizens continue to encounter problems when purchasing a car in a member state and transferring it permanently to a different member state,” the statement said.

SOLVIT, Europe’s online tool for detecting and solving problems related to the single market, reports that five per cent of cases in SOLVIT are related to vehicle registration.

THE EUROPEAN Commission has formally asked Cyprus to change its legislation on import and excise duties of new cars because it is more favourable to Cypriots than other EU nationals, it was announced yesterday.

The commission said Cyprus should change these rules within two months or face possible sanctions.

“If within two months there is no satisfactory response from the Cypriot authorities, the Commission may decide to refer the matter to the European Court of Justice,” an EU statement said.

The Commission said under the current legislation, Cypriot citizens, nationals and descendants, received more favourable treatment that other EU citizens when it comes to new passenger car import and excise duties.

“Under Cypriot legislation, EU nationals who set up permanent residence in Cyprus may only benefit from an exemption from import and excise duty when they import a new car if they are not practicing any profession in Cyprus,” the Commission said.

However, the same condition does not apply to Cypriots who return to the island for permanent settlement.

“Therefore, the Commission is of the opinion that the rule discriminates against non-Cypriot EU citizens and is contrary to Article 18 of the Treaty on Functioning of the European Union.”

The law also violates the freedom of movement for workers and the freedom of establishment, the Commission said.