Budget - VRT Changes

JHMEG

E92 wrote: »

The solution is really simple, put all the money made on VRT onto petrol. It would shoot up petrol prices by 30 cents a litre.

Thats a huge amount, and it would incentavise people a lot better than the current system to use public transport,drive more economically and drive less often. It would be harsh, but you said it yourself, the money has to come from somewhere.

This can't be done. The govt here has let the housing market run out of control, and as a result there are tens of thousands of young home owners who had no choice but to buy a house in Longford, Laois, Wexford, Louth etc, whilst working in Dublin. These people have already been shafted. Every increase in the price of fuel shafts them more, and hopefully the govt realise this.

I was talking to someone in the motor trade recently and they were saying they've had absolutely no indication from the minister what will happen with VRT, even tho the new system is supposed to be in on 01/01/08.

Fairest would be based on CO2 (which is fairly proportional to fuel economy), with the lowest paying less VRT than they are now, and the highest paying more than they are now.

Tipsy Mac

I'd say the vast majority of motorists are unaware of what VRT even is, until they become aware that they are paying an illegal tax it will never become an election issue.

I myself am looking forward to the next EU referendum to come our way, that will be the time to stand up and vote down in protest at whatever they want us to vote for.

JHMEG

Tipsy Mac wrote: »

they are paying an illegal tax it will never become an election issue.

The simple fact is VRT is a required revenue stream for the exchequer. The alternative to VRT is to whack up income tax, a legal tax, and one you can't avoid.

At least with VRT you can minimise how much you pay by buying smaller, less frequently, or 2nd hand. Or avoid it altogether by not buying a car.

I'd prefer VRT to having to pay an extra 5-10% income tax.

Tipsy Mac

JHMEG wrote: »

The simple fact is VRT is a required revenue stream for the exchequer.

<newsflash>We are now in the EU, where goods should have free movement.</newsflash>

JHMEG

Tipsy Mac wrote: »

<newsflash>We are now in the EU, where goods should have free movement.</newsflash>

I think it's people and labour, not goods.

But anyway, if VRT were to be abolished and fuel excise can't be raised to compensate, are you ok paying maybe 5 to 10% more income tax to make up the shortfall?

(I'm sure you're already aware VRT isn't a tax on the "goods", ie cars, but rather on the registration to drive on public roads)

E92

JHMEG wrote: »

This can't be done. The govt here has let the housing market run out of control, and as a result there are tens of thousands of young home owners who had no choice but to buy a house in Longford, Laois, Wexford, Louth etc, whilst working in Dublin. These people have already been shafted. Every increase in the price of fuel shafts them more, and hopefully the govt realise this.

I was talking to someone in the motor trade recently and they were saying they've had absolutely no indication from the minister what will happen with VRT, even tho the new system is supposed to be in on 01/01/08.

Oh it can be done. But nobody will have the political balls to do it. Not even the Greens with their "moral high ground" about FF. A big difference. In saying that I understand the pressures about commuting etc.

If the Government were serious about protecting the enviornment this is what they would do.

But in the absence of that a tax based entirly based on CO2, with no special helpings for smaller engines, petrols over diesel etc would be the next most sensible thing to do.

I believe the Governmeent will change VRT, and they will do it so that it will apply on 1/1/08. They're not telling anyone(not even the SIMI) what they will be doing, because they don't want us to take advantage and buy something today that could be taxed a lot more tomorrow.

Don't you remember what happened the last time they changed VRT where they moved the 30% threshold down from 2000 cc to 1900 cc?

unkel

You've several strong arguments there, JHMEG

I feel VRT is wrong. Having said that, it is a huge cash cow for the government (what, more than €2 billion per year now?). It is the easiest tax ever to collect from the eager '08 plate cravers. New car buyers seem happy enough to pay VRT. They would perhaps not be so happy to have to fork out substantially higher direct or indirect taxes replacing it

On another note, some of us have seen calculations of the total pollution of a car over its lifetime. Looks like fuel consumption is only a minor part of it in some cases. If we can get people to use cars for longer rather than buying new every year, we'd reduce pollution. In that light one could see VRT as a tax on pollution caused by producing cars

Then there's your point about people moving away from Dublin just to be able to buy a house. It would be very unfair to punish those Dublin commuters that have just bought a house quite a bit away from their place of work further by now adding more exise duty to the cost of fuel. Then again, in principal the polluter should pay

Cionád

astraboy wrote: »

I'd definitely support this. I pay tax on a 1.8 Alfa(Cue abuse from toyota drivers):D:rolleyes: and I am in college, I walk to college every day and only drive the car weekends to go home or the odd time during the week. I'm paying the same tax as someone that drives their car to and from work every day, while I choose to walk almost everywhere during the week. It would mean people are reminded of both their choice of car and their journey distance every time they fill up the tank, not just once or twice a year.

The arguement is for dropping VRT and hiking up fuel prices to make the difference, not dropping Motor Tax which I think you are reffering to.

I'd probably support this Motor Tax replaced with higher diesel costs but would not support abolishing VRT. Motor Tax must be paid by everyone, VRT only by new car buyers. The money has to come from somewhere, and if a bulk is to come from someone buying a hummer, i'm all for it!

JHMEG

unkel wrote: »

Then again, in principal the polluter should pay

Yes, but in an Irish way because of an Irish problem. The polluter will pay, but based on their potential to pollute. Anyway a lot of people seem to forget that we already pay quite a high price for fuel with the excise and VAT that's already in place. We just don't pay as much as the UK, but the polluter, in the classical sense, is already paying.

@E92, I'm not one of those unfortunate people that has been forced to buy 30, 40, or even 80 or more miles from work.

Charlie McCreevy once brought the housing market under control (after 3 Bacon reports), only to have his good work undone by Fianna Fail the Property Developers Party a year later, and find himself shipped off the Brussels. I voted against FF/PD in the last election primarily because of this.

However, it's now something we have to live with and I am strongly opposed to shafting those 10s or 100s of thousands of people who have massive commutes. If the govt feels the same (I think they do) then I, for once, agree with them.

RedorDead

JHMEG wrote: »

This can't be done. The govt here has let the housing market run out of control, and as a result there are tens of thousands of young home owners who had no choice but to buy a house in Longford, Laois, Wexford, Louth etc, whilst working in Dublin. These people have already been shafted. Every increase in the price of fuel shafts them more, and hopefully the govt realise this.

I was talking to someone in the motor trade recently and they were saying they've had absolutely no indication from the minister what will happen with VRT, even tho the new system is supposed to be in on 01/01/08.

Fairest would be based on CO2 (which is fairly proportional to fuel economy), with the lowest paying less VRT than they are now, and the highest paying more than they are now.

As far as i remember the changes are due to be announced in the budget in December with an implementation date of mid 2008. No source im afraid.

Dwilly

Cionád wrote: »

Motor Tax must be paid by everyone, VRT only by new car buyers. The money has to come from somewhere, and if a bulk is to come from someone buying a hummer, i'm all for it!

I don't believe VRT is only levied against new car buyers. The average price of a car in Ireland is around 30% dearer than in the UK, whether new or old, simply because depreciation is consistent with the new car price inc. VRT.

Hence if a commuter that drives 70 miles to Dublin buys a 3 year old car for €10,000 I'm assuming it would really only cost him around €8,000 if the car was 30% cheaper when new. Surely that saving of €2,000 could go towards counteracting a substantial fuel bill increase over the life of the car?

I agree with a fuel hike to replace VRT.

corkandproud

Spoke to a dealer yesterday, he reckons a loading on SUV's but not until June.

E92

The last time they changed VRT, it was announced in the Budget in December, and came into effect on the 1 st of January, so there was only IIRC 2-3 weeks that people knew in advance that things were changing.

I doubt it that there will be any change this time either.

Owen

corkandproud wrote: »

Spoke to a dealer yesterday, he reckons a loading on SUV's but not until June.

Speaking as a dealer, no one knows what's happening, so I'd take what your dealer said with an entire packet of saxa.

littlejukka

unkel wrote: »

Then there's your point about people moving away from Dublin just to be able to buy a house. It would be very unfair to punish those Dublin commuters that have just bought a house quite a bit away from their place of work further by now adding more exise duty to the cost of fuel. Then again, in principal the polluter should pay

this is a big issue regards VRT and how it could be otherwise recouped by the exchequer.

people are forced into commuter towns like navan, ashbourne and gorey with a couple of hours of a commute to dublin just to get that 3-bed semi with a small garden they can barely afford. unfortunately these people shouldn't be living there in the first place, there should be provision for high density residential accommodation within the m50 served by quality bus and rail services to get from A to B whenever the user requires. but there isn't.

VRT is just a symptom of what is wrong with the integrated transport/finance/employment/housing issues created since the early 90s.

Pete4779

daedalus2097 wrote: »

I agree with the tax on petrol instead - that way, the more you use it, the more tax you pay, rather than the current system which is something like the number of hits on their quote service multiplied by the day of the month, multiplied by the page number of the magazine open in the canteen. Look at the UK where petrol is up around £1.30 in places. Pounds. And look how much cheaper cars are there. Choose whatever car you like and if it's a gas guzzler you pay for it that way.

Of course, this being Ireland they'll hike the tax onto the petrol, and then just rename the VRT and leave it in place

Eh? We already have tax on petrol and if you use more of it then you pay more.

And on VRT? You buy a bigger car you already pay more for it in VRT tax than the smaller engined car.

On yearly road tax? There is a clear scale of increasing cost so you can do exactly what you say - buy a gas guzzler and pay for it with higher road tax.

We pay less on petrol but pay far more on road tax. Overall, it probably works out the same over a year.

It seems the only benefit of lower VRT or scrapping VRT is to allow people to buy new larger engined and higher specced cars that they otherwise couldn't afford to. VRT should probably go up slightly every year to encourage people to use public transport and the extra money should go to areas of the country that mostly adapt to that. It should also be far far higher on smaller engined cars which account for the vast majority of cars on the road and congestion.

VRT should be left the same for larger engined cars but definitely increased for cars under 2l as that is the biggest market and largest source of congestion with people young enough to cycle or take public transport.

What do people think?

littlejukka

Pete4779 wrote: »

Eh? We already have tax on petrol and if you use more of it then you pay more.

And on VRT? You buy a bigger car you already pay more for it in VRT tax than the smaller engined car.

On yearly road tax? There is a clear scale of increasing cost so you can do exactly what you say - buy a gas guzzler and pay for it with higher road tax.

We pay less on petrol but pay far more on road tax. Overall, it probably works out the same over a year.

not so. the VRT and road tax are based on cost, engine size and age rather than emissions, which is the real measure of how much of an environmental impact a car is making.

by levying fuel rather than the car itself, the cleaner engines with better fuel economy are rewarded over the dirtier engines, whether or not the engine is bigger, smaller, newer or older.

Triangle

Hmmm Fuel is already taxed, so already the higher petrol/diesel users are being dealt with.

VRT should not exist - moving it to petrol is not the correct way imo.

Dwilly

Pete4779 wrote: »

It seems the only benefit of lower VRT or scrapping VRT is to allow people to buy new larger engined and higher specced cars that they otherwise couldn't afford to.

Why do you say only larger engined cars? A reduction of VRT will help everybody afford better specced/larger cars.

Gatster

VRT should probably go up slightly every year to encourage people to use public transport and the extra money should go to areas of the country that mostly adapt to that

If it was the case that VRT was actually spent on the roads, or public transport, then I wouldn't mind. As it is, it's not, and probably won't ever be. Public transport is terrible in our biggest city, and I can't imagine it's any better anywhere else. The farce that is the LUAS is a shining example of this half-arsed effort...

galwaytt

JHMEG wrote: »

Fairest would be based on CO2 (which is fairly proportional to fuel economy), with the lowest paying less VRT than they are now, and the highest paying more than they are now.

...only in theory. In practice we're supposed to be following the 'polluter pays' principle. So my old car, being a 94 with suitable 1994 emissions will be permanently disadvantaged against someone buying new. Emissions have moved on in 13 years, you see.......so, will the govt subsidise me getting a new car, to 'clean up my act' ? - don't think so.....and besides, any saving in emissions is entirely offset by the cost of actually building a new car, over continuing to use an existing one........

At least with VRT you can minimise how much you pay by buying smaller, less frequently, or 2nd hand. Or avoid it altogether by not buying a car.

No, you can't. If you live outside the 'by-the-rest-of-the-country-subsidised' public transport system (aka, outside Dublin), you have to have a car. You cannot work, live or educate, without it. Which means more mileage, which means more wear/tear, which ultimately means........you change your car every-so-often. And you cannot then, avoid VRT.