Classic Cars Free From 25% Import Tax, However There’s a Twist | Carscoops

      Vehicles that are at least 25 years old are exempt from the new tariffs when imported to the US.

      Classic cars have avoided the impact of Trump’s new import tariffs.

      Vehicles older than 25 years bypass the 25 percent duty on automobiles.

      This policy aligns with the existing 25-year rule governing the import of classic cars.

      Brands like Porsche, Jaguar, and Bentley—those that lack a production facility in the US—are not the only ones worried about Donald Trump’s new 25 percent tariffs on auto imports. Smaller companies that specialize in vintage cars from these brands are also affected, but now they can breathe a sigh of relief.

      That’s because while new vehicles face the 25 percent tariff, which has led Audi and JLR to temporarily suspend all shipments to the US, collector cars are exempt from these additional duties. This news is positive for classic car enthusiasts in the US as well as for the specialty businesses, both domestic and international, that rely on robust demand from America.

      Tariffs Could’ve Hurt More

      If vintage cars had been subjected to the 25 percent tariff, prices would have soared. A $100,000 Lancia Delta Integrale would have cost $125,000, a Ford RS200’s price could have increased by $150,000, and some highly sought-after 1960s Ferraris might have seen price hikes of over a million dollars. Fortunately, these vehicles will continue to enter the country under the previous arrangement, being charged only a 2.5 percent duty, which should keep demand stable.

      Had imported vintage cars faced the 25 percent tax, it would have been disastrous for an industry supported by 43 million classic cars in the US valued at over $1 trillion, based on data from Hagerty.

      The 25-Year Rule Limitation

      However, there is a limitation to this exemption: only vehicles that are 25 years or older qualify. If a vehicle entering the country is 24 years and 364 days old or younger, it will incur the same 25 percent tariff as a new car. Thus, cars like BMW’s E46-gen M3 CSL, which has recently marked its 20th anniversary, and the even younger Subaru Impreza RA-R are now significantly more costly to import than prior to April 2, when the new tariff came into effect.

      But the 25-year tariff rule aligns with existing regulations that only permit the legal use of imports older than 25 years on American roads if they do not conform to federal safety and emissions standards, which shouldn't pose a problem.

      The Rationale for the Exemption

      Exempting classic cars is logical, as lawyers from Simon Gluck & Kane LLP pointed out in a letter to US Trade Representative Jamieson Greer, according to Bloomberg. If the 25 percent tariff caused a car to be priced out of the market, it would not only deny the government the duty revenue but would also affect state revenue generated from taxes on the vehicle's sale in the US. This revenue can be significant; Bloomberg cites a potential $700,000 on a $10 million classic car.

      It’s unclear whether President Trump is a classic car enthusiast, but ultimately, it seems to revolve around financial implications. The US could potentially lose substantial amounts if classic cars, worth millions, were subjected to the same tariffs as new cars. Coupled with Jay Leno’s recent visit to the California Capitol advocating for a bill to exempt vehicles 35 years and older from smog checks, US collectors have yet another reason to be happy—besides the stunning cars already in their garages.