BMW 316 and new VRT rules

DaveBH

To answer Harry's question - As far as I know a 316 will be around €100 cheaper to tax come July 1st.


Can somebody check my VRT maths here please?

Now, assuming current base price and VAT - I want to roughly predict the new price of a 316 in July.

Current base price - 24,531
Current VRT - 8,617 (currently attracts a rate of 25%)
Current VAT - 5,151

Current price new (approx) - 38,300

Right, so under the new VRT regime, the car will attract a VRT rate of 20%.

So, the base price of 24,531 now represents 80% of the total (before VAT) - correct?

24,531 divided by 80 and multiplied by 100 gives (approx) 30,664.

Add on 21% of that figure (VAT) = 30,664 + 6440 = 37,104.

If I'm right on this calculation (PLEASE correct me if I'm not!), then the 316 RRP will fall (assuming no change in its base price) by approx. €1,200.

Can someone let me know if I have calculated correctly or not?!

Many thanks.

E92

DaveBH wrote: »

To answer Harry's question - As far as I know a 316 will be around €100 cheaper to tax come July 1st.


Can somebody check my VRT maths here please?

Now, assuming current base price and VAT - I want to roughly predict the new price of a 316 in July.

Current base price - 24,531
Current VRT - 8,617 (currently attracts a rate of 25%)
Current VAT - 5,151

Current price new (approx) - 38,300

Right, so under the new VRT regime, the car will attract a VRT rate of 20%.

So, the base price of 24,531 now represents 80% of the total (before VAT) - correct?

24,531 divided by 80 and multiplied by 100 gives (approx) 30,664.

Add on 21% of that figure (VAT) = 30,664 + 6440 = 37,104.

If I'm right on this calculation (PLEASE correct me if I'm not!), then the 316 RRP will fall (assuming no change in its base price) by approx. €1,200.

Can someone let me know if I have calculated correctly or not?!

Many thanks.

VRT is worked out after VAT is applied. I've done the calculations for the expected price of all the 4 cylinder 3 series models at one stage or another in recent days. Just go to other threads like the ones about VRT changes etc. 20% VRT = €290 to tax, the same as the more powerful, cheaper and therefore better 318i.

fdisk

Block exemption rules only mean that a manufacturer cannot refuse to sell cars to a dealer - the way they get around this is to enforce quality standards and servicing requirements that make it very difficult for a non approved dealer to meet. Cars sold here are the cheapest in Europe at pre-VRT prices - manufacturers of certain marques make a more basic model for this market. The BMW or Toyota dealership is not going to drop it's prices by several thousand euro next July - you might get a slightly better spec, but there is absolutely nothing stopping a dealer setting the selling price of a car - except for competition in the market - and we all know just how competitive car dealerships try to be.

unkel

A BMW dealer told me the 316i won't be for sale any more after the VRT changes come into place!

E92

unkel wrote: »

A BMW dealer told me the 316i won't be for sale any more after the VRT changes come into place!

Well that's hardly a bad thing, right?(especially as the pre tax price of it is higher than the more powerful 318i)

FWIW, having checked the base level 318i/d and 320i/d E90 3 series, BMW's pre tax prices for Ireland seem to be almost the same as the ones for Germany(a shade higher because we're RHD and the manufactureres are allowed charge a higher pre tax price as a result, but it must be a very small premium, there are no SE versions of the 3 series in Germany so I didn't look at the 6 cylinder models as it would be impossible to compare accurately), and German spec BMW's are equivalent to the base model here, so I would expect the savings for VRT to be passed on in full to the consumer here for BMW's at least.

Gandalf23

E92 wrote: »

I would expect the savings for VRT to be passed on in full to the consumer here for BMW's at least.

I expect this to happen too. I was talking to a few BMW salespeople today and they agree with E92.

Gandalf23

unkel wrote: »

A BMW dealer told me the 316i won't be for sale any more after the VRT changes come into place!

This is a great thing!

Gandalf23

There is a lot of information on prices on the BMW website

BMW 3 series Irish prices here

BMW 3 series UK prices here

BMW 3 series German prices here

JoeA3

BMW diesels look like big winners in this new VRT/tax system.
By my rough calculations, a 320D M-Sport Coupe will drop from approx €61K today, to close to €51k post July :eek:
And just €150 p/a road tax! We'll be seeing lots of these on irish roads I reckon.

JHMEG

Yup, we're all gonna have to get brand new BMWs!

Gandalf23

Might not be a bad idea JHMEG!

According to my calculations ... the 318i ES has a 10% VRT reduction (30% currently dropping to 20%) from July 2008. The current OMV of this car on the BMW.ie website is €40650. This should mean the price including VRT will drop from €40650 to €37500. Not a bad saving, and very good value for that car IMHO!

E92

Gandalf23 wrote: »

According to my calculations ... the 318i ES has a 10% VRT reduction (30% currently dropping to 20%) from July 2008. The current OMV of this car on the BMW.ie website is €40650. This should mean the price including VRT will drop from €40650 to €37500. Not a bad saving, and very good value for that car IMHO!

Its better than that. It actually works out to be €35,568 so €35,600 which a saving of over 5 grand!(you calculated VRT wrongly, you thought that you add on 30% of the VAT inclusive price when in fact 30% means the TOTAL price of the car is VRT).

Gandalf23

E92 wrote: »

Its better than that. It actually works out to be €35,568 so €35,600 which a saving of over 5 grand!(you calculated VRT wrongly, you thought that you add on 30% of the VAT inclusive price when in fact 30% means the TOTAL price of the car is VRT).

Apologies in advance for being so stupid ... could you explain this in greater detail please? I thought VRT was calculated on the VAT inclusive price! What price is VRT calculated on?

How EXACTLY do you arrive at the new price of €35,568 if the current OMV (including current 30% VRT) is €40,065 !!???!??!

E92

Gandalf23 wrote: »

How EXACTLY do you arrive at the new price of €35,568 if the current OMV (including current 30% VRT) is €40,065 !!???!??!

Go back to page 1 of this thread. It's all there in post 19.

NE14T

I'm afraid some numbers and facts quoted in this thread are misleading:

Car dealers are free to raise their list prices for 1 July 2008, and if the tax on certain models reduces prices to below a level the market has been shown to bear, it would be naive to expect them to do otherwise. The marketing fig-leaf they will apply to this will be "increasing the spec," most likely in the form of options you were unlikely to specify such as Xenon lights etc.

VRT is based on the Open Market Selling Price (OMSP) of the car, as estimated by the Revenue, which may or may not be the same as the list price + VAT. The Revenue may take the view that the actual value of a July 2008 BMW 320d is higher (same car with lower running costs) than a Jan 2008 BMW 320d and revise the OMSP upwards accordingly. VRT rules are famously non-transparent.

If there are two groups of people on whom you can rely to not act in the interests of the consumer it is SIMI and the Revenue.

PS The maths earlier in the thread were incorrect. Should the list + OMSP miraculously remain the same, the new price would be:

320d SE current price incl 30% VRT: €50,850
List price + VAT = 50,850 / 1.3 = €39,115
Post 1 July 2008 price incl 16% VRT = 39,115 x 1.16 = €45,374.

Personally I am considering a 520d SE which will theoretically go from €54,250 to €48,407 plus delivery etc. If the dealers and the Revenue do not hike this price up, it is a reasonable price by Irish standards for a fine car (it's €37,900 in Germany :-).

E92

NE14T wrote: »

I'm afraid some numbers and facts quoted in this thread are misleading:

Car dealers are free to raise their list prices for 1 July 2008, and if the tax on certain models reduces prices to below a level the market has been shown to bear, it would be naive to expect them to do otherwise. The marketing fig-leaf they will apply to this will be "increasing the spec," most likely in the form of options you were unlikely to specify such as Xenon lights etc.

VRT is based on the Open Market Selling Price (OMSP) of the car, as estimated by the Revenue, which may or may not be the same as the list price + VAT. The Revenue may take the view that the actual value of a July 2008 BMW 320d is higher (same car with lower running costs) than a Jan 2008 BMW 320d and revise the OMSP upwards accordingly. VRT rules are famously non-transparent.

If there are two groups of people on whom you can rely to not act in the interests of the consumer it is SIMI and the Revenue.

PS The maths earlier in the thread were incorrect. Should the list + OMSP miraculously remain the same, the new price would be:

320d SE current price incl 30% VRT: €50,850
List price + VAT = 50,850 / 1.3 = €39,115
Post 1 July 2008 price incl 16% VRT = 39,115 x 1.16 = €45,374.

Personally I am considering a 520d SE which will theoretically go from €54,250 to €48,407 plus delivery etc. If the dealers and the Revenue do not hike this price up, it is a reasonable price by Irish standards for a fine car (it's €37,900 in Germany :-).

BMW have committed themselves to passing on the VRT reductions in full.

The 520d SE manual is coming down by €8,190, don't take my word for it, thats from the MD Seán Green. So it will cost €46,060 in July.

And OMSP is 92% of RRP usually. I realise I made an error earlier, not using OMSP(but this was before I got told here that OMSP is 92% of RRP), but you've made an error with the formula too.

For the 520d, €54,250 - [€54,250 X 92% X (100-30)/(100-16)] = VRT saving.

So €54,250 - VRT saving = €54,250 X 92% X (100-30)/(100-16)= New List price.

(and btw, I know the list price should be a bit lower, but I'm making the massive assumption that BMW use 92%(I don't know if they do or not), so any small discrepancy you find is down to this, in the case of the 520d, its about €300 out)

BMW are leaving the spec unchanged, so if dealers are selling them for more than €46,060 then you can be sure they're selling you ones with extras, but if you order a 520d SE with no options, then you will pay €46,060 minus whatever you can haggle off them.

And have a look at this thread, everything you need to know is there for BMW and all other makes.

kaymin

"For the 520d, €54,250 - [€54,250 X 92% X (100-30)/(100-16)] = VRT saving."

Surely the VRT saving is calculated by:
54,250 X 92% X (30%-16%) = €6,987

and therefore the expected price of this car post June would be €47,263