Brexit and how it af­fects you – don't miss our full anal­y­sis.

The big vote’s com­ing. Here are the big is­sues for the clas­sic scene

Classic Car Weekly (UK) - - News -

The up­com­ing ref­er­en­dum, which takes place on 23 June, to de­cide on whether the UK will leave the Euro­pean Union (EU) has in­evitable con­se­quences in store for clas­sic car own­ers in the UK, re­gard­less of the out­come.

Since the pre­vi­ous Labour govern­ment left of­fice in 2010, it’s gen­er­ally recog­nised that there has been greater recog­ni­tion and ap­pre­ci­a­tion of clas­sic cars in West­min­ster. Many pos­i­tive changes have been in­tro­duced with­out ref­er­ence to leg­is­la­tion in the wider EU. Where his­toric ve­hi­cles have com­plex, recog­nised le­gal sta­tus in much of Europe with re­stric­tions on use, Bri­tain has wel­comed the free move­ment of parts and ve­hi­cles with­out plac­ing oner­ous lim­its on how we use our clas­sic cars.

Euro­pean tourism has boomed, and the im­port and ex­port of cars and their com­po­nents ex­ploded in an eas­ily-ac­cessed in­ter­na­tional mar­ket. This has re­sulted in easy main­te­nance and a steady growth in val­ues of clas­sic cars. But should own­ers of clas­sic cars wel­come, or fear, Brexit?

The trade view

The free and easy trad­ing of clas­sic cars within Europe for us Brits – some­thing we’ve en­joyed for more than a decade – could change, al­though by how much will come down to trade ne­go­tia­tors, if we choose to leave the EU.

Daniel Dono­van, the founder of clas­sic car dealer DD Clas­sics says that the mar­ket is al­ready on the move, and won’t set­tle un­til the re­sult of the ref­er­en­dum is known on 24 June. How­ever, you might be sur­prised by how it’s mov­ing, and that’s as much down to tur­bu­lence in Europe as it is our own ref­er­en­dum.

‘Clas­sic car in­vest­ments face sig­nif­i­cant growth as fi­nan­cial mar­kets wob­ble,’ Daniel says. ‘With th­ese un­par­al­leled lev­els of un­cer­tainty fac­ing the Euro­pean con­ti­nent right now, it is be­lieved that we will see more in­vestors fo­cus­ing their sights on lux­ury items to re­tain a sig­nif­i­cant re­turn on in­vest­ment.’

Econ­o­mist Roger Boo­tle says that traders who buy and sell abroad could ben­e­fit from Brexit, by look­ing favourably be­yond Europe. ‘We would be free to es­tab­lish agree­ments with mar­kets such as China, Brazil, Rus­sia and In­dia through the World Trade Or­gan­i­sa­tion,’ he says. All have fast-grow­ing clas­sic car mar­kets.

In­vest­ment bank KPMG con­cluded it would be bet­ter for the car in­dus­try to re­main in the EU. ‘The at­trac­tive­ness of the UK as a place to do au­to­mo­tive busi­ness is de­fined by its mem­ber­ship of the EU,’ says its lat­est re­port.

Be­yond the sim­ple mat­ter of buy­ing and sell­ing clas­sic cars, there are im­pli­ca­tions for own­ers. Parts sup­ply and costs are ex­pected to in­crease if we leave the EU. For many, low-cost parts from East­ern Europe have had a sig­nif­i­cant im­pact on the run­ning costs of clas­sics. They are man­u­fac­tured to a recog­nised qual­ity stan­dard, but are not cur­rently af­fected by im­port duty.

The im­porter view

Should we vote to leave the EU, duty on im­ports would be ex­pected to re­turn in ad­di­tion to VAT.

John Kulin, from clas­sic car im­porter Golden Char­i­ots cer­tainly feels that this is the case, and that bring­ing cars in from Europe will end up cost­ing more.

‘To im­port a ve­hi­cle from out­side the Euro­pean Union, in­di­vid­u­als will have to pay VAT and a 10% duty on the value of the car,’ he says.

‘Some­one im­port­ing a car from the in­side the EU won’t have to pay VAT. So they’d just have to pay cus­toms duty, trans­porta­tion and a £55 fee to reg­is­ter the car in the UK.’

Then there’s the mat­ter of what is – and what isn’t – a his­toric ve­hi­cle. When im­port­ing from the USA, there’s the is­sue of dif­fer­ing lev­els of duty for his­toric and non-his­toric ve­hi­cles. And it’s not based purely on the age of the ve­hi­cle.

Auc­tions and sales of­fer most scope for ad­di­tional costs should we choose to leave the EU. Al­ready ex­pen­sive for in­di­vid­u­als with­out a busi­ness to ab­sorb the pre­mi­ums and VAT or ac­count for on­ward sale re­liefs, the Govern­ment will be quick to see op­por­tu­nity away from a uni­fied mar­ket. Own­ers and auc­tion houses could find an ad­di­tional bur­den of work to ac­count for dif­fer­ent du­ties, and should the EU model con­tinue to break down, an over­all re­duc­tion in the value of clas­sic cars could re­sult as trade stag­nates.

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