do we really want to do away with VRT???

jon1981

seriously dont shoot me for this, but would we all just be slashing the worth off our own cars if the government done away with VRT tomorrow. if you bought a car today, then tomorrow it would be worth 30% less along with the natural depreciation? how would used car dealers prepare for it? would it put alot of car dealers out of business?

siralfalot

jon1981 wrote:

do we really want to do away with VRT???

simple answer : yes, its an illegal tax, however it would have to be phased out over a couple of years to stop the car industry from going into freefall

peasant

Don't see the problem:

Your car looses X% ...so does every other car.

So whatever you buy next is going to be cheaper as well (cheaper than it would have ben without the VRT being axed) ...you get less for your trade-in but you also pay less for whatever you buy.

You only loose out in real terms if you don't replace your car.

The only real problem would be for dealers whose (pre-financed) stock value drops by a massive amount over night.

But not for the private car owner

Blitzkrieger

Dealer's will still be making their margins - we'll just get better cars cheaper.

Gatster

But not for the private car owner

Not true surely? What about the amount of people with car finance (loans or dealer provided). Lots of people could suddenly find themselves owing more than the car is worth if VRT was abolished overnight.

Kimbot

Gatster wrote:

Not true surely? What about the amount of people with car finance (loans or dealer provided). Lots of people could suddenly find themselves owing more than the car is worth if VRT was abolished overnight.

Exactly, but the other factor is they want to change it to higher road tax so those of us that paid VRT on our cars are paying it twice!!

peasant

Gatster wrote:

Not true surely? What about the amount of people with car finance (loans or dealer provided). Lots of people could suddenly find themselves owing more than the car is worth if VRT was abolished overnight.

Yeees, but

A car depreciates anyway ...so you always owe/pay more than it's worth.

But you still get your next one cheaper / for a smaller loan

easyontheeye

peasant wrote:

Yeees, but

A car depreciates anyway ...so you always owe/pay more than it's worth.

But you still get your next one cheaper / for a smaller loan

yes but if VRT was removed it would be worth ~30% less on top of the yearly depreciation. surely people who just bought a new car would be screwed if they wanted to sell it a year later, as in most cases you can sell a car a year later for a price that will cover the remainder of the loan, but if the VRT was cut you would never be able to do that.

ballooba

Every car will lose value. Every car will pay the increased car tax. There is no problem. There will be free movement of cars between the UK and Ireland, opening up a huge market to us completely. All round it is going to be cheaper.

smash

Yes it should be gone... instantly

stevenmu

peasant wrote:

The only real problem would be for dealers whose (pre-financed) stock value drops by a massive amount over night.

I'd imagine dealers would get some form of tax break or concession allowing them to recover whatever they lost on VRT.

edit: and yes it should be gone, ASAP

walshs3

Then the government would have to go and make up the money somwhere else,i.e much dearer fuel prices,dearer tax etc or maybe up the tax rate on anything that makes them alot of money ie cigarettes, the tax you pay on the money you earn.So unless you dot work and dont smoke youll probably be paying for it one way or another.

00sully

what are the odds of this happening? I was planning on buying a car in England and coughing up the VRT (in about 6 months). If there was a chance of this being abolished then obviously I wouldnt. Is there talk about this in the govt? did I miss a meeting?

ballooba

It doesn't matter if they make up the revenue elsewhere. The main problem is the free movement of goods within the EU. We should be able to buy cars in UK, Malta or wherever we like and bring them here without having to shell out VRT.

Eoin

peasant wrote:

Yeees, but

A car depreciates anyway ...so you always owe/pay more than it's worth.

If you get a personal loan maybe, but when the car secures the loan, then the lending institute generally try and ensure that the car is always worth more than the outstanding balance in case the loan is defaulted. That's why you'll find that the age of the car will determine the maximum length of the loan. The monthly payment is nearly always going to be more than the decreased value of the car with age.

Not that all that really matters - it will affect some people for a short time; hopefully it would all equal out in the long run. What I'd be interested to know is how the goverment would make the money up instead of VRT - I'd be surprised if they're willing to take the hit.

Stephen

I imagine they'd slap higher taxes on petrol and diesel, and probably bring in some kind of carbon emissions tax too. Ideally this would replace today's cubic capacity based motor tax too.

Tax on fuel is the fairest way to do it. If you use more fuel, you pay more tax. Today's VRT-dodgers wouldn't be able to avoid paying it unless they want to give up driving, and the state gets revenue from people they'd never normally get it from - those driving foreign registered vehicles.

ballooba

Yep. Tax on fuel makes the most sense. Not every driver in the state pays motor tax but unless your car is electric you are buying fuel.

jimmychin

is vrt being abolished?

or is this a hypothetical thread?

i was planning on buying in the north, but may hold off now if something is in the pipeline...

Eoin

I think that higher tax on fuel is more likely to replace or supplement road tax, rather than VRT.

Stephen wrote:

Tax on fuel is the fairest way to do it. If you use more fuel, you pay more tax.

It's fair if there's decent public transport available to everyone, but I don't think that's the case. Driving is not a choice but a necessity for a lot of people.

mdebets

peasant wrote:

So whatever you buy next is going to be cheaper as well (cheaper than it would have ben without the VRT being axed)

Do you honestly think the prices would go down?
The dealer knows that the customer is willing to pay Price + VRT at the moment. What makes you think, the dealer would not just increase the Price by the amount of VRT, as he knows the customer is willing to pay so much for the car.

astraboy

mdebets wrote:

Do you honestly think the prices would go down?
The dealer knows that the customer is willing to pay Price + VRT at the moment. What makes you think, the dealer would not just increase the Price by the amount of VRT, as he knows the customer is willing to pay so much for the car.

Because we could import cheaper from the UK without having to pay tax! VRT is an excessive tax that prevents people from buying newer more economical and safer cars. I would like to see VRT phased out over 7-8 years so that the tax is reduced by a small amount each year and the burden is reduced, without the bottom falling out of the car market overnight.

Plus, with cheaper(or at least better value) cars coming to our shores, I'm sure the increase in sales the dealers would see would make up for any reductions in the value of their stock over the course of the changes. I would love to see VRT gone, alas I am dreaming of an Ireland where we can buy "big" 2 litre cars without being peanilised. Maybe I'll just stay in the US or move to the UK where performance cars are both cheaper to buy and run!

ballooba

mdebets wrote:

Do you honestly think the prices would go down?
The dealer knows that the customer is willing to pay Price + VRT at the moment. What makes you think, the dealer would not just increase the Price by the amount of VRT, as he knows the customer is willing to pay so much for the car.

Because there never was VRT in the UK and you will have UK prices to compare against. A little bit of common sense please.

rebel.ranter

It's not going to go away, neither is road tax. I would rather see the whole thing abolished, VRT & Road Tax, then just make up the difference with fuel prices. It would mean then that I could have my multiple cars to drive whenever I liked as long as insurance was up to date. Obviously some refund schemem would have to be put in place for hauliers & the like.
The big thing is there is a whole Civil Servant workforce working on the whole Road Tax/VRT management. There would be uproar if they had to change their desk name plates!!! That's why it'll never happen.

If it was to go it shoudl be done 1%-2% per year to negate any additional depreciation of older cars.

beerbaron

We could import them at a more affordable price if they abolished VRT

ballooba

beerbaron wrote:

We could import them at a more affordable price if they abolished VRT

We could also export them. The prices would be the same between UK and Ireland. It doesn't mean that it would be any cheaper to buy in the UK. It would be the same price.

mdebets

ballooba wrote:

Because there never was VRT in the UK and you will have UK prices to compare against. A little bit of common sense please.
....
It doesn't mean that it would be any cheaper to buy in the UK. It would be the same price.

That's Ireland, remember.
How many goods without VRT do you know that have the same price in Ireland as they have in the UK (even if you look at them without VAT)? None.
What will most likely happen if VRT is that the prices will go up, until they reach the original prices with VRT, just now everything is going into the pocket of the dealer, because nobody shops around.

craichoe

And the dealers would be stuck with a load of New Lower specced cars that they wouldn't be able to shift because you could just take a trip over the border and buy the same car for the same price with Aircon, Leather Trim, Cruise control etc

IMHO its a rubbish tax that should be abolished

mdebets

craichoe wrote:

And the dealers would be stuck with a load of New Lower specced cars that they wouldn't be able to shift because you could just take a trip over the border and buy the same car for the same price with Aircon, Leather Trim, Cruise control etc

How many people are going over the border to buy a new TVs, computer or kitchen appliances?
By your logic, all the Irish PC Worlds and Dixons, etc. wouldn't sell anything, because you could just go over the border and buy them there cheaper.

ballooba

mdebets wrote:

That's Ireland, remember.

It makes no difference. It's your own fault if you don't shop around. Shop around in this circumstance will include NI and UK. You will even be able to trade in your own car in the UK.

mdebets wrote:

How many goods without VRT do you know that have the same price in Ireland as they have in the UK (even if you look at them without VAT)? None.

Cars are the only goods with VRT (Vehicle Registration Tax).

mdebets wrote:

What will most likely happen if VRT is that the prices will go up, until they reach the original prices with VRT, just now everything is going into the pocket of the dealer, because nobody shops around.

The UK are not going to raise their prices because we drop VRT. The UK market is a multiple of the size of the Irish one. We are insignificant

The more likely effect of VRT dropping is that Irish poverty spec cars will no longer be attractive because there will be full access to UK spec cars. Good luck trying to sell a base model Irish car in the UK.

ballooba

mdebets wrote:

How many people are going over the border to buy a new TVs, computer or kitchen appliances?
By your logic, all the Irish PC Worlds and Dixons, etc. wouldn't sell anything, because you could just go over the border and buy them there cheaper.

People already go to the UK. The price differential between the UK and Ireland for consumer goods is miniscule when compared to the differences imposed by VRT. In fact I have noticed no difference at all between PC World prices in UK and Ireland.

smash

mdebets wrote:

How many people are going over the border to buy a new TVs, computer or kitchen appliances?
By your logic, all the Irish PC Worlds and Dixons, etc. wouldn't sell anything, because you could just go over the border and buy them there cheaper.

That's not a good comparison, there's a minimal difference in prices between good of that nature between countries, if ther's any difference at all!

you wouldn't go to the uk to save 50euro on a pc because it would cost you about 600 to get there... however you would go to the uk to save 3k on a car and if VRT was gone, you could save about 6k!

(average figures....)