VAT removed on small cars, hybrid and electric vehicles; ATVs, outboard engines

Finance Minister Dr. Ashni Singh, in presenting Budget 2026 themed “Putting People First” to the National Assembly, announced measures aimed at reducing the cost of vehicle ownership and improving transport in hinterland regions.
Double-Cab Pick-Ups
Dr. Singh said double-cab pick-ups, vital for businesses and households alike, will now face a flat import tax: $2 million for vehicles under 2,000 cc and $3 million for those between 2,000 cc and 2,500 cc, regardless of age.
VAT removal on smaller vehicles
The Minister also announced the removal of Value Added Tax (VAT) on new vehicles below 1,500 cc. “Vehicle ownership is not a luxury but an economic necessity,” he said, noting that this measure builds on the 2023 Budget, which introduced a flat tax of $800,000 for used vehicles under 1,500 cc.
Hybrid, low-emission vehicles
Expanding on the 2023 initiative that removed VAT on new electric vehicles, the Government will now also remove VAT on hybrid motor vehicles below 2,000 cc. The move is intended to encourage low-carbon development and a gradual shift toward environmentally friendly transportation.
ATV, hinterland transport
The Minister further stated that all import duties and taxes on all-terrain vehicles (ATVs) will be eliminated across all categories. Additionally, taxes and duties on outboard engines up to 150 horsepower will be removed to support transport in hinterland and riverine communities.