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Cost Of Owning A Vehicle In Japan

There are many factors that promote the Japanese to purchase new vehicles. One of biggest reasons is the cost of keeping an older automobile.

Taxes - "Zeiken"

  • Acquisition Tax
    • 5% of the car's "purchase price" when you buy the vehicle
    • 3% for commercial vehicles and light automobiles ["Kei" cars])
    • You pay this once.
  • Weight Tax
    • Calculated according to the cars weight.
    • Must be paid in advance for the number of years your "shaken" certification lasts.
      • When purchasing a new car, you must prepay three years of this tax.
      • Afterwards, you will have to pay this tax at every "shaken" inspection for two years length.
  • Annual Automobile Tax
    • Determined by the engine's displacement volume (CC - cubic centimeters).
    • It costs between ¥5,000 (for a Kei) to ¥56,000 (for 3Liter cars) each year in May.

Parking Fees - "Shakoshomei"

  • Each registered vehicle must have an offical parking spot.
    • If your in the rural mountain areas then renting/buying one can be relatively cheap
    • But in the cities, the prices rise sharply.
    • Prices are also according to the car's physical size.
      • Your car must (by law) fit into your spot.
      • Costs for a mid-size car owner annually between ¥15,000 to ¥75,000.

Insurance - "Hoken"

  • There are two levels of insurance:
    • "Kyosei Hoken" which is madatory only covers crash damages. i.e. minimal coverage
    • "Jibaiseki Hoken" is in addition to "Kyosei Hoken" and will cover injuries and non-accident car damages.
      • Most Japanese will also buy this insurance to protect themselves.

Inspection - "Shaken"

  • The most expensive aspect of owning a car is the "Shaken".
    • Shaken is a maintenance test used to inspect the car's safety.
  • Key advantage of buying a new car is that you don't have to pay for the "shaken" the first time (included in the cost.)
    • First shaken lasts three years.
    • After, the vehicle must pass the "Shaken" every other year.
  • Around ¥120,000 to ¥200,000 for an average car.
  • Kei-class cars run around ¥80,000.

When Japanese consider all the costs involved (especially "Shaken"), they find less and less value in their old cars. They must make a choice between keeping the car or buying new.

The new Kei-class (small) cars in Japan cost ¥1,000,000 (relatively cheap) and are cheaper to operate/keep. This factor and the fact maintenance shops are expensive also push people to buy newer, smaller cars.

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