New VRT Bands in todays Indo

kluivert

Two points I would like to suggest please.

1. This is not a envirnomental forum - can all the green envirnomentalists please leave.

2. On a serious note, this is Ireland and the reduction in VRT rates will NOT be passed onto the customer.

You have to remember its the distributors etc that decide the retail price of a car.

If a top selling diesel like the 1.4 d4d Auris is going to reduce in price because of a drop in VRT, the RRP in my opinion will stay the same, thus a great margin for dealers on this car.

Its Ireland, consumers get screwed, known fact.

Any savings will be taken in by distributors and dealers, and not pasted onto the consumers.

Live in hope though.

Mailman

Pushing up VRT rate on higher emmitting vehicles may also kill the import market if applied retrospectively to older cars.

The details of the changes aren't clear yet but it is obvious the tax man hates the secondhard import trade and will do everything they can to kill it.

I'm guessing that Revenue have been looking at the types of cars imported and since people don't bother importing smaller cars they may have found a way of targetting the larger\sportier cars that get imported secondhand.

I'd guess a lot of these secondhand imports which were charged at 25% or 30% of OMSP will now be charged at 36% of OMSP and that is on top of Duty and VAT which have to be paid too.

mike65

If thats true (tinfoil hat I supect!) then peeps will turn to importing diesels. A cars a car, as far as a saleman is concerned.

Mike.

Mailman

mike65 wrote: »

If thats true (tinfoil hat I supect!) then peeps will turn to importing diesels. A cars a car, as far as a saleman is concerned.

Mike.

No conspiracy theories here. I know of a dealer whose life has been made impossible by Revenue adjusting VRT rates and OMSPs so that the cars they have coming in on the boat are uneconomic to sell once they arrive.
If VRT goes to 36% and it will be 36% for many older vehicles that will kill the secondhand import market.

galwaytt

does this mean my car should be VRT-free

so, if I were ye, I'd start borrowing and importing all your specials, now. M3, RS6's, M5, RX8, etc.

Has my car, therefore, gone up in value now?

HarryHood

Phoned BMW and got the definitive Carbon rating for the new 316 1.6 petrol engine. It's 142g. The 318 Diesel is 123g.

Looks like I may well be better off going diesel!

E92

kluivert wrote: »

2. On a serious note, this is Ireland and the reduction in VRT rates will NOT be passed onto the customer.

You have to remember its the distributors etc that decide the retail price of a car.

If a top selling diesel like the 1.4 d4d Auris is going to reduce in price because of a drop in VRT, the RRP in my opinion will stay the same, thus a great margin for dealers on this car.

You too like a lot of people don't realise the fact that it is *illegal* under EU law(Block Exemption) to set different pre tax prices from EU state to EU state. *Before* this happened all the time so Irish cars seemed only a fraction dearer compared to their UK counterparts even though we were always stung with VRT. So of course the situation you described would have happened, and what's more was perfectly legal too to happen. However, the trend in the past few years has been for UK cars to get cheaper while at the same time Irish cars go dearer. Why? Because the pre tax price for cars for the UK was way higher than it was for here, however now that we have block exemption the makers have been forced to sell all cars at the same price.


Look at this gems of answers(source)

5.1.1. Sales

Question 25: Is a consumer free to buy a vehicle wherever he/she considers it to be most
advantageous in the Single Market?

The consumer’s freedom to buy anywhere in the Single Market is one of the fundamental achievements of the European Union, and the Regulation reinforces the right to buy amotor vehicle in another Member State. A manufacturer, importer, or area distributor maynever restrict a dealer from selling to any consumer who contacts him directly, through an intermediary, or via the Internet. If a supplier were to instruct a dealer not to sell to
consumers from other Member States, sought to deter him from doing so or imposed any
restrictions on sales to such consumers, this would be a serious restriction of competition,
which would mean that the supplier’s distribution agreements would not be covered by
the block exemption. In recent years, the Commission has detected several infringements
of EC competition rules which involved restrictions on sales to foreign consumers and has

fined the undertakings involved.

Question 31: Can the dealer charge a right-hand-drive supplement or another similar
kind of surcharge?

Surcharges, such as right-hand-drive supplements, which take account of differences in
vehicle specification between Member States, and reflect differences in the cost of
production or distribution, are not in themselves restrictive of competition. However, the
level of surcharge must be objectively justifiable, particularly with regard to the real
additional cost of producing or delivering the vehicle. There is no rule of thumb for
calculating what an objectively justified level of surcharge in any given case might be,
since amongst other things, the additional cost of producing or delivering the vehicle in

question will vary depending on the model.

So what this tells us is that if they want to charge us more because our cars are RHD, they must do exactly the same thing for the UK, and not only that but they can't choose a different pre tax price for Country A and another for country B.

What all of this says is that the reductions in price as a result of VRT changes *have* to be passed on to the consumer, because to do otherwise is a breach of EU rules, but more importantly if they do increase the price of cars with a VRT reduction or don't pass on the saving to you and me, then it means that the price in the UK has to go up and in the rest of Europe the price must go up too. And even if they don't pass on the saving(which they can't), all it takes is one make to pass on the saving, and the rest will be forced to if they want to keep doing buisness. supply and demand and all that.

FWIW it's in the manufactureres interests to keep the price of diesels low, because they all have to offer 1.6 engines in cars like the Avensis because of VRT(which they don't bother with across the pond), so if people switched to diesel they could get rid of the expenbse of doing this and also it would reduce the average CO2 emissions of the car fleet, and with rules like an average CO2 emissions of 130 g/km to be mandatory from 2012 they might just get a step closer.

Its also in the government's interest to make sure that the full savings are passed on to consumers for the similar reasons because we have a comittment to cut our CO2 emissions by 3% per annum for the next 5 years under the programme for Government, and if the government doesn't help to facilitate people buying cars that can pollute as much as 30 g/km less of CO2, we're going to have an even bigger problem with Kyoto than we already have(after all we were only allowed increase CO2 emissions by 13% compared to 1990, and we went well over that a couple of years ago) so we're going to be forced to spend even more on Carbon Credits, so the Government ought to make the proposed changes asap and ensure that consumers get the reductions passed on.

And there are already 50% VRT rebates for hybrids available and for flexi fuels. taking the flexifuels which would be the ones I'm most familiar with, the Volvo Flexi fuel models are quite considerably cheaper than their equivalent petrol models(check Volvocars.ie if you don't believe me), and Saab do the same as do Ford(and toyota and lexus do too with their hybrids).

kaiser sauze

kluivert wrote: »

Two points I would like to suggest please.

1. This is not a envirnomental forum - can all the green envirnomentalists please leave.

2. On a serious note, this is Ireland and the reduction in VRT rates will NOT be passed onto the customer.

You have to remember its the distributors etc that decide the retail price of a car.

If a top selling diesel like the 1.4 d4d Auris is going to reduce in price because of a drop in VRT, the RRP in my opinion will stay the same, thus a great margin for dealers on this car.

Its Ireland, consumers get screwed, known fact.

Any savings will be taken in by distributors and dealers, and not pasted onto the consumers.

Live in hope though.

I made exactly this point, along with a small handful of others, earlier in this thread.

It is all well and good to talk about all things being equal and that we will benefit from government policy changes, but as it rightly pointed out here, we will not see any difference in prices. The distributors and dealers will swallow it up. Remember when McCreevy reduced VAT and then put it back up again as retailers/suppliers etc etc were not passing on the change. Same thing will happen.

Mark the words of those who have stated it.

mike65

Well if we all know the score, we've no-one to blame but ourselves if the new regime does'nt result in reduced prices.

Mike.

mike65

http://www.todayfm.com/article.asp?id=15131

Its being discussed now. It'll be availible for download in about 3 hours.

Mike.

Meister

mike65 wrote: »

http://www.todayfm.com/article.asp?id=15131

Its being discussed now. It'll be availible for download in about 3 hours.

Mike.

Did anybody just hear the SIMI, slate this proposal, and bang on about free parking for Hybrids & low emission cars. And not make any reference to the fact that Diesel cars will in most cases become cheaper.

Is it possible that he does'nt want the huge inblace that will now appear between Petrol/Diesel cars, and is more interested in stopping all imports. But does not really care what price new cars are as long as the imports are stopped?

MarkR

Buying a uk car shortly, has 155 for carbon emissions. Brings it from 30% down to 20% I think for vrt.

colm_mcm

does this change in VRT only apply to cars first registered in 2008, and not imports of older cars? that's my understanding.

mike65

So there will be two different types of this illegal tax then?

Mike.

astraboy

colm_mcm wrote: »

does this change in VRT only apply to cars first registered in 2008, and not imports of older cars? that's my understanding.

I hope not, if they do this across the board, and Irish importers do not pass on the price reductions, then at least people can go to the UK and import the car themselves and make full use of the new VRT brackets.

Unfortunately this also means we are stuck with VRT as its now a green fluffly, save the foxes and reduce carbon emissions tax.:mad: As if getting a couple of people out of X5's and into priuses is going to make up for Chinas production of a coal fired power plant each week.:rolleyes:

copacetic

astraboy wrote: »

I hope not, if they do this across the board, and Irish importers do not pass on the price reductions, then at least people can go to the UK and import the car themselves and make full use of the new VRT brackets.

Unfortunately this also means we are stuck with VRT as its now a green fluffly, save the foxes and reduce carbon emissions tax.:mad: As if getting a couple of people out of X5's and into priuses is going to make up for Chinas production of a coal fired power plant each week.:rolleyes:

good point we should really change VRT to be a tax on chinese power plants. oh, wait...

Lex Luthor

there aint enough diesel pumps in the forecourts to cope with this demand of diesel cars we'll see in the next few years

E92

colm_mcm wrote: »

does this change in VRT only apply to cars first registered in 2008, and not imports of older cars? that's my understanding.

Surley it should go back all the way to 2002, that was the year Britain swtiched it's company car tax system from a mileage based one to an emissions based one, so CO2 data would be available for anything since 2002(actually my car is fast approaching 8 years old and it has CO2 emissions of 164 g/km, so I'm sure that CO2 data was there a good bit before 2002 as well)?

One thing I'd be interested in is people's choice of wheel size and choice of transmission. If you look at brochures for Fords and Opels, you will often see that they publish a different set of CO2 emissions and mpg figures for the same engine, better figures for smaller wheels and weaker figures for larger wheels. What will they do with VRT then, if by choosing say 17 inch wheels as opposed to 16 inch wheels you go from one VRT band to another? Surley if they charge the extra VRT rate to the whole car that system is completely openm to abuse, because whatr are they going to do if someone decides they want 16 inch wheels(because the car gets into a lower VRT) but then "suddenly":rolleyes: wants the bigger and more polluting wheels after taking delivery of the car.

Like the Opel Vectra 1.9 CDTI(either version, they both have the same CO2). If you choose 19 inch wheels you get a car that pollutes 157 g/km so you're landed into the 24% VRT category. Which is a big improvement on 30% of course.

However if you want the same car with 16,17 or even 18 inch wheels, you now have a car that pollutes 154 g/km of CO2, so its now in the 20% VRT category.

Are they going to just charge 24% on the wheels themselves of will they charge 24% on the whole car? I think I've just thrown a huge spanner in the works there, haven't I, because I see that being abused by dealers and customers completely. I mean, go back to my example above, what if decide if you "suddenly":rolleyes: want bigger wheels just a day after buying the car? Or will they just make retrofitting bigger wheels illegal or what will they do?

The next thing that intrigues me is Automatics, though I think this is a lot more predictable. I'm sure there are plenty of cars out there that will fall into a lower VRT band when they have a manual than they will with an Automatic. The Vectra CDTI sure enough is an example of this. A manual on 16-18" wheels is on 154 g/km or 20%, an Auto on 16,17 or 18's is 28% because it pollutes 186 g/km of CO2.

I presume what happens here is that the higher rate is charged entriely on the car, I don't see any way out of that one, plus I don't see how that can or will be abused. A pain in the ass for Wheelchair people who need an Automatic no doubt(though I think the can get their cars VAT free), that said an Auto Vectra diesel will still be cheaper then it is at present.

E92

kaiser sauze wrote: »

I made exactly this point, along with a small handful of others, earlier in this thread.

It is all well and good to talk about all things being equal and that we will benefit from government policy changes, but as it rightly pointed out here, we will not see any difference in prices. The distributors and dealers will swallow it up. Remember when McCreevy reduced VAT and then put it back up again as retailers/suppliers etc etc were not passing on the change. Same thing will happen.

Mark the words of those who have stated it.

Emperor,(since Kaiser is German for emperor:D) look at post Nr 129 in this thread. I explained in it exactly why this can't happen, because it is *completely* illegal for them to do so. Any if they did pocket the difference, explain to me then why the Lexus LS600h is €20,000 cheaper than it should be, and look at the Volvo S40 pricelist. Note what the cheapest model is. If we were using your logic then Volvo would have gone and trousered the €3200+ difference between the Flexifuel S40 1.8 and the non Flexifuel 1.8 wouldn't they? The S40 Flexifuel sits in the 12.5% band, the non flexifuel 1.8 is in the 25% VRT band, so if the non flexifueled S40 S were in the 12.5% VRT band it would cost €24,900(29050X0.75/0.875). And before you ask, 25% VRT refers to the total price of the car, not that they took whatever the normal price on a VRT free S40 would be and slapped a 25% tax on it(hence my decimalised 75%).

And its hardly a fluke by Volvo, the cheapest Saab 9-3 and 9-5's are both the Flexifuel models, and surprise surptise they have a VRT rebate too. Needless to say Toyota, Honda and Lexus pass the saving on their customerts with their hybrids. What your saying while (and don't get me wrong, if it wasn't for the reasons outlined by me in post No 129, I know they would do it:D) perfectly understandable happens to bne perfectly illegal too! Its because of block exemption that this has happened(which started 4 years ago actually).

And I remember very well that prices did indeed go down when VAT was dropped, however because it was only 1%, it was a very small difference(as in a few hundred euro of a difference at the very most).

kaiser sauze

E92 wrote: »

Emperor,(since Kaiser is German for emperor:D) look at post Nr 129 in this thread. I explained in it exactly why this can't happen, because it is *completely* illegal for them to do so. Any if they did pocket the difference, explain to me then why the Lexus LS600h is €20,000 cheaper than it should be, and look at the Volvo S40 pricelist. Note what the cheapest model is. If we were using your logic then Volvo would have gone and trousered the €3200+ difference between the Flexifuel S40 1.8 and the non Flexifuel 1.8 wouldn't they? The S40 Flexifuel sits in the 12.5% band, the non flexifuel 1.8 is in the 25% VRT band, so if the non flexifueled S40 S were in the 12.5% VRT band it would cost €24,900(29050X0.75/0.875). And before you ask, 25% VRT refers to the total price of the car, not that they took whatever the normal price on a VRT free S40 would be and slapped a 25% tax on it(hence my decimalised 75%).

And its hardly a fluke by Volvo, the cheapest Saab 9-3 and 9-5's are both the Flexifuel models, and surprise surptise they have a VRT rebate too. Needless to say Toyota, Honda and Lexus pass the saving on their customerts with their hybrids. What your saying while (and don't get me wrong, if it wasn't for the reasons outlined by me in post No 129, I know they would do it:D) perfectly understandable happens to bne perfectly illegal too! Its because of block exemption that this has happened(which started 4 years ago actually).

And I remember very well that prices did indeed go down when VAT was dropped, however because it was only 1%, it was a very small difference(as in a few hundred euro of a difference at the very most).

Minion

I take onboard what you say about the legal requirements on carmakers and dealers.

If I may make a simplistic point: The dealers are under no obligation not to raise their margins. Free market 'n' all. This would circumvent what you're saying as the prices are staying the same because they are taking more profit.

I'm just a terrible skeptic. I don't know why I'm even really interested as nobody should buy new cars. It is the single biggest, or each time you buy a new car, waste of money that a person indulges in.

I really do hope that I am wrong, but with the SIMI attitude today, I'm not optimistic.

spanner_man

Does anyone know what the effect of the new VRT system will have on hybrid cars? At the moment cars such as the Lexus LS600h/GS450h/RX350h enjoy a 50% reduction in VRT. I presume this 50% reduction will not be continued in the new system.

On this basis, the prices of these 'enviornmentally friendly' cars will go up considerably, for example a GS450h is currently about 85k with 15% VRT. At 186gCO2/KM the new rate of VRT would be 28% bring the price closer to 95k.

E92

HarryHood wrote: »

Phoned BMW and got the definitive Carbon rating for the new 316 1.6 petrol engine. It's 142g. The 318 Diesel is 123g.

Don't make a decision till you hear the budget. It's NOT yet official, there could well be changes between now and then. Though since the Sindo is saying this is what is going to happen, I would be very certain that what they're saying will actually happen, since that paper is like a party Political Broadcast for Feel and Fail. Don't get carried away yet. When you hear the budget THEN make up your mind.

Just so you know, here are the speculated prices come 1/7/08.
Current 316i ES €38,300
316i ES from 1/7/08 €35,900(so €2,400 less)
318i ES from 1/7/08 €35,600(so €2,700 less and €300 less than the VRT adjusted price of the 316i ES)

318d ES from 1/7/08 €37,200(so €1,100 less)

So the 318 diesel will still cost €1,600 more than what we're speculating is the VRT adjusted 318 petrol, but at the same time will still be €1,100 cheaper to buy than a 316i being bought in the morning, however a 318 petrol will be €2,700 cheaper from July than a 316 petrol(before the VRT adjustement).

CorporalCarrot

I am surprised that in 8 pages of discussion there has been little or no mention of the hypocrisy of this change in VRT. Its a cynical rebalancing exercise dressed up as environmentalism, when the real solution (i.e. to tax fuel ) is staring people in the face but would be too politically unpalatable for a couple of years.

I am one of the individuals who will be badly affected by this change. I like to drive a nice car. It produces approx 290gm CO2/km. I however walk to work and do less than 5000km pa in the car. Someone else will do 20k plus per annum in a car producing 150gm/km. They are pumping more than twice the co2 into the atmosphere as I am, yet I am the one taking the big pole up the a$$ while they waltz around in their low tax free environment patting themselves on the back about how "green" they are. How is this equitable or going to address environmental concerns? Is the guy driving the ferrari and already paying over 150k in tax really going to see the error of his ways because of an extra 5k?

I am disappointed that none of the radio shows today addressed this usage issue today.

Also the fallacy of this latest Saab car getting a rebate when it is not physically feasible for anyone to actually achieve the CO2 ratings it nominally gets because the only biofuel available here is 5% ethanol.

Sometimes it sickens me being a motor enthusiast in this country.

C

ismynametoolong

What amazes me about VRT is that it is an unfair tax that the EU is wholly opposed to but cant remove .
VRT is also an unjustly calculated tax in that it is a % figure derived from the retail price of the car ie it is a tax calculated on a figure that already
supposes its inclusion.This is why there is an OMSP open market selling price
which is declared by the manufacturer.If the manufacturers refused to put
forward an OMSP it would scupper the revenues calculation of VRT.

Ronanom

ismynametoolong wrote: »

What amazes me about VRT is that it is an unfair tax that the EU is wholly opposed to but cant remove .
VRT is also an unjustly calculated tax in that it is a % figure derived from the retail price of the car ie it is a tax calculated on a figure that already
supposes its inclusion.This is why there is an OMSP open market selling price
which is declared by the manufacturer.If the manufacturers refused to put
forward an OMSP it would scupper the revenues calculation of VRT.

Here here....


Bottom line is we pay €€€€'s more than our counterparts in the UK for the exact same thing

Meister

ismynametoolong wrote: »

What amazes me about VRT is that it is an unfair tax that the EU is wholly opposed to but cant remove .
VRT is also an unjustly calculated tax in that it is a % figure derived from the retail price of the car ie it is a tax calculated on a figure that already
supposes its inclusion.This is why there is an OMSP open market selling price
which is declared by the manufacturer.If the manufacturers refused to put
forward an OMSP it would scupper the revenues calculation of VRT.

On that very point, I asked the dept of finance today (under Freedom of Information),
1. How is it calculated (VRT)

2. How is the Open Market, Selling Price (OMSP) determined, what bodies and groups are involved, in the decision making process.

3. Could you provide be with an example of the process used. eg a current car example.

the foi address is foi@finance.gov.ie.
I put a reciept request onto the email, so far looks as if it hasnt been opened yet.

E92

spanner_man wrote: »

Does anyone know what the effect of the new VRT system will have on hybrid cars? At the moment cars such as the Lexus LS600h/GS450h/RX350h enjoy a 50% reduction in VRT. I presume this 50% reduction will not be continued in the new system.

On this basis, the prices of these 'enviornmentally friendly' cars will go up considerably, for example a GS450h is currently about 85k with 15% VRT. At 186gCO2/KM the new rate of VRT would be 28% bring the price closer to 95k.

It won't.

The GS450h will rise from €85k to €100,000, not €95,000.

Because you don't realise that 15% refers to the total price of the car, not that they got the non VRT and slapped a15% tax on it. So when it goes up to 28%, 28% of the 100k price is VRT. Your logic suggests that if the car cost 128k, then 28k would be it's VRT, but this is not the case, hence why VRT is the biggest scam ever, cause the figures are quite deceptive.

pburns

CorporalCarrot wrote: »

I am surprised that in 8 pages of discussion there has been little or no mention of the hypocrisy of this change in VRT. Its a cynical rebalancing exercise dressed up as environmentalism, when the real solution (i.e. to tax fuel ) is staring people in the face but would be too politically unpalatable for a couple of years.

I am one of the individuals who will be badly affected by this change. I like to drive a nice car. It produces approx 290gm CO2/km. I however walk to work and do less than 5000km pa in the car. Someone else will do 20k plus per annum in a car producing 150gm/km. They are pumping more than twice the co2 into the atmosphere as I am, yet I am the one taking the big pole up the a$$ while they waltz around in their low tax free environment patting themselves on the back about how "green" they are. How is this equitable or going to address environmental concerns? Is the guy driving the ferrari and already paying over 150k in tax really going to see the error of his ways because of an extra 5k?

I am disappointed that none of the radio shows today addressed this usage issue today.

Also the fallacy of this latest Saab car getting a rebate when it is not physically feasible for anyone to actually achieve the CO2 ratings it nominally gets because the only biofuel available here is 5% ethanol.

Sometimes it sickens me being a motor enthusiast in this country.

C

290gm CO2/km?

The guy doing >20,000 a year in a diesel Mondeo (mostly stuck in traffic) may be pumping out more CO2 than you but he doesn't exactly have much choice in the matter if that's part of his work.

I like cars as well but if someone actually WANTS to drive something that pumps out 290gm CO2/km most ordinary Joes will say they can damn well afford to contribute a nice juicy lump of VRT to the government - a balancing out the distribution of wealth blah blah...

OK, strictly speaking I can see your point. But I'm afraid not too many people will have sympathy with the fat cat who complains 'cos it's gonna cost more to drive a 4.0 litre V8 Bimmer M3 (which roughly equates to your stated CO2 output).

Between the 'anti-fast' lobby and the environmentalists I don't really see the point of a such a car anyway. If they get their way we'll all be driving 1.5 litre diesels.:(

peasant

E92 wrote: »

I think I've just thrown a huge spanner in the works there, haven't I,

Do you really think anyone in the governement is going to give a fiddlers fart?

You're still young, grasshopper ...:D

They're going to set ONE more or less arbitrary value per vehicle, based on some semi-official figure, possibly the highest one, take the cash and that's that.

This is Ireland. You bend over and take it from behind ...but you're left with the illusion that by somehow fitting bigger or smaller wheels you've got "one over " on the governement ...and everybody is happy

E92

pburns wrote: »

But I'm afraid not too many people will have sympathy with the fat cat who complains 'cos it's gonna cost more to drive a 4.0 litre V8 Bimmer M3 (which roughly equates to your stated CO2 output).

Surley you mean Beemer and not Bimmer:D? Bimmer is American, Beemer is European(and FWIW Beemers are what the Yanks call BMW Motorcycles, Bimmers are BMW cars in the US of A).