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Every new system implemented is going to have its critics. People are not accustomed to change and often reject what is different. Take the smoking ban for example. Initially it was slammed and berated, but even today smokers agree that it has been for the benefit of the country. An emissions-based VRT and Motor Tax system will see dramatic decreases in the cost of some cars, and will obviously benefit the environment, but are there other disadvantages that aren’t so obvious?
Why does VRT exist?One of the biggest complaints is that there is VRT to begin with. Dating back to the introduction of the system, critics claim that the registration fee is more of a double tax on the same item; VAT by another name. Car prices in Ireland are among the highest in Europe, and that is not because of the manufacturers price. It is due to the large amount of tax that we pay on top of that standard price. Though this new VRT system rewards those who buy cleaner cars, some call for a ban on all VRT, regardless of its system of rating. “VRT is still far too expensive, but at least it is now calculated more sensibly,” says
Conor Faughnan, Public Affairs Manager of AA Ireland. He believes that the new system will reduce the cost of cleaner cars and see more consumers choosing diesel engines, but still argues the case that Ireland is one of the most expensive countries to buy a car in Europe. “Keeping the new system revenue neutral means that the Government will still be taking in some €1.3 billion in VRT,” claims Faughnan. “The motoring sector in Ireland contributes about €5.7 billion in taxes annually. That’s about 9% of all government revenue – a colossal contribution.” Free movement banned?This VRT, and the VAT paid on imported cars, can be seen as customs duty. And considering we are an EU member state trade borders should not exist between us and other member states. Critics claim that these taxes on imports are denying Irish people of European rights. And considering our cars can be bought and exported out of the country by consumers from other member states to their financial gain supports the argument further. Even journalist and author David McWilliams claims that Irish people are being treated like second-class EU citizens when it comes to EU trade rights. He claims that we are not being allowed a free movement of goods. McWilliams is demanding that as Irish citizens we hold off on voting for the Lisbon Treaty until this issue is addressed. A grand demand in itself, it shows the extent to which this issue is a bone of contention. Provisions for public transportThe government announced this new emissions-based VRT and Motor Tax system in an effort to clean up Ireland’s emissions levels. It was by all means, a step towards a greener Republic. If this is the case, then the support and investment in public transport needs to be increased and monitored. Irish citizens could dramatically reduce emissions by not using their cars at all, and catching their local public transport to work. In doing this they would be using a service that would be running anyway, emitting carbon anyway, but they would reduce their own footprint. “Increasing taxation on heavy CO2-emitting cars is a positive step, but is it enough to bring about a significant change in behaviour? What of those who have no choice but to travel by car, because they do not have access to public transport?” argues Eamon Gilmore TD, Labour Party Leader. “One billion euro on replacing train carriages and commuter links are fine - if people didn't have to go to work until 2009, instead of Monday morning. Delivering reliable, efficient public transport infrastructure within the next few years - not the distant future - is what will bring about real behavioural change.” Assumed emissionAnother point to note is that the new system rates a car on the assumption that it will constantly be driven. It is based on the potential carbon that the car can emit, not the actual amount. Some drivers take public transport to work, particularly in cities, where parking costs outweigh the benefits of driving. Other motorists are car enthusiasts and buy cars to collect. These people are being penalised unfairly. If a car owner who drives a Nissan Micra, which emits 139g/km, does 10,000km a year, they will emit 1,390,000g of carbon. On the other hand, if a car owner of a Jaguar XK, which emits 269g/km, drives 5,000km a year, they will emit 1,345,000g/km. But the driver of the Jaguar will have paid a substantially higher VRT rate, and will continue to pay €2,000 annually in Motor Tax. Some critics have called for a tax on fuel consumption, or for Motor Tax to be changed each year with the number of kilometres on the car. At least in this case, the emissions tax would be based on actual emissions, rather than assumed ones. Already made the switchFinally, the new system of motor tax will be applied on all new and newly imported vehicles after 1st July 2008. This tax does not take account of motorist who has already switched to cleaner cars. Those who have a social conscience and made the step for the environment, and not necessarily their pocket, are now at a disadvantage. The new system should account for these vehicles in some way.
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So now its €1,980+vat(€525)= €2,505 !Add to this approx €240 of local terminal fees,and a customs broker (worth it),and your total is now €2,745. NOW ADD.. VRT of which i was quoted €523,and minus your original shipping cost of €800 and €420(customs+handling+brokers) of fees, and you reach a figure of €2,048. You have now paid more than the price of the car just in TAXES. (over 0). I had always thaught that VRT was a way for not losing out on Vat from Europe,but to have to now pay both is ridiculous.Ok,We pay VAT on other goods from outside the EU, but not registration fees