Vehicle prices would jump by around 2% when government’s new carbon tax was implemented on September 1, said McCarthy CEO Brand Pretorius on Monday.

This would add to last year’s vehicle price increases of between 12% and 13%, he noted.

Finance Minister Pravin Gordhan announced in his maiden budget speech last month that new passenger vehicles would be taxed based on their certified CO₂ emissions at R75 per g/km for each g/km above 120 g/km.

“We could see some preemptive buying in June, July and August,” said Pretorius. “After September we could see a degree of swing to used vehicles.”

Used vehicles were still exempt from the carbon tax.

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