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Mr. John Gormley, T.D., Minister for the Environment, Heritage and Local Government today (19th June 2008) launched the new vehicle labelling system which will apply to all new cars at the point of sale from 1st July 2008. The Government recently introduced changes to Vehicle Registration Tax (VRT) and annual motor tax for new cars registered on or after 1st July 2008 . Both taxes will be calculated on the basis of carbon dioxide (CO2) emissions from vehicles rather than engine size. Seven emission/tax bands have been created and VRT and motor tax payable will be determined by the relevant band for each vehicle. A key element of the whole initiative to rebalance the VRT and motor tax regimes on the basis of CO2 emissions is the introduction of a new labelling system designed to reflect the seven emission/tax bands.
The purpose of these changes is to incentivise consumers to purchase vehicles with lower CO2 emissions, an important step in reducing national greenhouse gas emissions and in meeting Ireland’s commitments for the purposes of the Kyoto Protocol. Minister Gormley said: “The clear objective of the new CO2-based tax structure for cars is to influence the purchasing decisions of consumers by rewarding the buyers of low-emitting cars and charging a premium on less efficient vehicles. From 1st July, anyone buying a new car can make a positive choice on investment and environmental grounds by purchasing a low CO2 emitting vehicle. As well as enjoying the benefits of a lower rate of motor tax and any saving on the pre-July purchase price of the car, they will be making a very positive personal contribution to the national response to climate change. Anyone who makes the choice to purchase a high CO2 car will have to pay a higher rate of motor tax, in addition to any price rise as a result of the VRT changes.” Vehicle labelling is not a new idea. A 1999 EU Directive introduced labelling for all new vehicles, including specific requirements to provide consumers with information on fuel economy and CO2 emissions. Minister Gormley pointed out that “the new national system will strengthen these existing EU requirements. As well as providing additional information in relation to VRT payable and running costs, the new label is designed to be more consumer-friendly. The seven colour-coded bands will be familiar to consumers from the energy label for certain electrical goods, such as fridges, washing machines, electric cookers and light bulbs. The overall approach is intended to assist buyers in evaluating the environmental impacts of different cars, as well as providing guidance for them on purchase and running costs.” The new vehicle labelling system will be introduced initially on a non-statutory basis, in cooperation and with the agreement of the Society of the Irish Motor Industry (SIMI) and it will apply to all new cars at point of sale. It is intended that the new system will be established on a statutory basis later in the year. “I see the improvements in vehicle labelling as a positive step in enabling Irish motorists to make a direct personal contribution to combatting climate change” Minister Gormley concluded. “I very much welcome the support of SIMI in introducing the new label from 1st July and I look forward to continuing to work with the motor industry in making this very positive step a success.”. Comprehensive information will be available on the website www.change.ie . The information available will be a guide for users and punter friendly.
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