Vehicle taxation should be reconsidered

Abstract

Vehicle taxation is a global issue. When considering the appropriate tax regime for vehicles, states consider a variety of factors. Among others, vehicle taxation takes into consideration traffic congestion (loss of time), environmental issues such as air pollution, accidents, noise, land use for roads and parking lots, costs of control and enforcement system, damage to the natural environment, and much more.
 Israel imposes purchase tax on vehicles, which is a tax quite equivalent to GST or excise duty.
 As will be presented below, in 2022, apparently, Israel's vehicle taxation, imposes 83% purchase tax on vehicles, is probably the highest in the world.
 Vehicles are a daily, routine product that exists in almost every home worldwide. A vehicle isn't a luxury product anymore, but Israel, according to the tax rate, still considers it a luxury.
 The high tax rate has not achieved its goal, to discourage the usage of personal vehicles and shift to public transport.
 The high tax regime encourages repetitive debates between importers and that customs authority, concerning the vehicles value, for customs purposes.
 A reform in this field is needed. Maybe it's time for Israel to reinvent to wheel in this area, and impose a fixed tax, ignoring the vehicle's price.