Efforts to Scrap Tariffs on Bus Imports Fail

Efforts to Scrap Tariffs on Bus Imports FailEfforts to Scrap Tariffs on Bus Imports Fail

Attempts by Iran’s tourism authority and industry insiders to remove or reduce tariffs on bus imports have failed, with a high-ranking official effectively putting an end to the efforts by citing legal hurdles.

In May, a proposal made in late 2014 by Iran’s Cultural Heritage, Handicrafts and Tourism Organization to reduce the tariff on a limited number of imported tour buses to renovate the aging fleet of substandard coaches was rejected by the Cabinet.

Officials at the Ministry of Industries, Mining and Trade, who were opposed to the scheme from the outset, argued that the move would undermine Iranian automakers, which they claimed are capable of meeting the land transport needs of the fledgling tourism sector.

The organization had requested tariffs to be removed from only 1,000 vehicles, including tour buses.

A month later, tourism officials, along with industry heavyweights, began discussing the matter with Iran Customs Administration to get the government to reverse its decision on the proposal.

However, ISNA reported late Thursday that the efforts have failed, quoting the president of the Trade Promotion Organization of Iran as saying that scrapping the tariff is legally impossible.

Valiollah Afkhami added, “It’s the law; it doesn’t allow for imported cars to enter the country without a certain fee.”

He said importing vehicles is free and “whoever wants to do it, is free to do so, as long as they’re willing to pay the necessary tariffs”.

This has drawn the ire of the proposal’s supporters, including Nasrollah Pejman, a member of Majlis Cultural Commission.

“This spells the end of efforts to develop the sector,” he was quoted as saying by the news agency. “Pleas by countless people active in the field have been rejected because one person says it’ll impact the economy,” he said, referring to Industries Minister Mohammad Reza Nematzadeh.

  Waiting It Out

Local media say the Industries Ministry’s reasons for rejecting the proposal were twofold: First, to help empower domestic carmakers by compelling tour companies to buy Iran-made buses; and second, to boost government coffers by levying customs tariffs.

“They [the Industries Ministry officials] argue that reducing customs tariffs for imported buses will undermine domestic automakers,” Masoud Soltanifar, head of the ICHHTO, said in June.

This is while some, including Ebrahim Pourfaraj, president of the Iranian Tour Operators’ Society, say Iranian-made buses fail to meet international standards.

“They mount the body of a minibus onto a chassis made for a sedan, so how can you call that a standard vehicle?” he complained.

Supporters of the scheme say both inter- and intra-city tour buses must be renovated and brought up to standard.

The ministry has promised that Iranian carmakers will be able to provide ICHHTO with the 1,000 vehicles they have requested by September.

“Now we’ll have to wait and see if they can deliver,” Soltanifar said.

The country’s woefully underdeveloped tourism infrastructure is in dire need of renovation and expansion. While efforts are being made to build more hotels and renovate the aging air fleet, little if anything has been done to address the lack of quality buses.