Italy Raises Taxes On SUVs, Luxury Cars

Italian owners of luxury cars and sports utility vehicles will face a huge increase in the annual auto tax next year as part of a government bid to rein in the budget deficit and reduce pollution. Vehicles weighing more than 5,700 pounds and certain luxury cars will be subject to higher taxes depending on their power, amounting to nearly double the current rates.

The fee for a Jeep Cherokee, for example, will rise from $524 to $933. That for a Mercedes SUV will rise to $1,311, while a Toyota Land Cruiser will be charged $875. A Rolls Royce Phantom's tax burden will rise from $1,110 to $1,970, while a Mercedes limousine will cost its owner $2,215 next year, from $1,248.

The tax rise comes as vehicle registrations have fallen for a third consecutive month in Italy, shrinking 3.24% in September compared with the same month last year.

The government of Prime Minister Romano Prodi aims to trim Italy's budget deficit by $33 billion in 2007.

Copyright Agence France-Presse, 2006

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