New motor tax and VRT regime. Links + calculations

unkel

cyborg wrote: »

Don't know where these E745 684 etc figures are coming from, tax on a 1.8 is 484 rising to 530 post feb.

I was wondering where those figures are coming from myself. The Mondeo 1.8 TDCI has 1753cc. So the current tax is indeed €484 and with the additional 9% this will be €527.56 from 01/02/2008 - whatever way that will be rounded. See the first post for motor tax rates

Mr Magnolia wrote: »

To purchase a 1.8TDCI Mondeo now (149mg) would cost around 32k with VRT at 30%.

Under the new system the VRT will be 20% making the cost ~29k.

Is this about right?

Use the formula:

32000 * (1-0.30) / (1-0.20) = 28000

Mr Magnolia

Just after getting some additional info (Thanks Mike )

The VRT is going from 25% to 20% which means:
Cost pre July 2008 - ~32,000

Cost Post July 2008 - ~30720, which is only 1,280 less than now.

The road tax isn't as bad as Shane thought as ye pointed out too, only going up 5% to €527.56

The_Conductor

Mr Magnolia wrote: »

The road tax isn't as bad as Shane thought as ye pointed out too, only going up 5% to €527.56

Yes. I thought I'd try ringing the Department of the Environment (as the roadtax rates on their website is from 2004) but wasn't able to get throught their automatic phone system

More letter writing to John Gormley this morning I think (they must think I'm a crank at this stage.......)

unkel

Mr Magnolia wrote: »

The VRT is going from 25% to 20% which means:
Cost pre July 2008 - ~32,000

Cost Post July 2008 - ~30720, which is only 1,280 less than now.

I should have spotted it is only 25% currently, not 30%. Formula:

32000 * (1-0.25) / (1-0.2) = 30000 (new price)

Mr Magnolia wrote: »

only going up 5% to €527.56

9%

smccarrick wrote: »

I thought I'd try ringing the Department of the Environment (as the roadtax rates on their website is from 2004)

Those rates are still valid. Motor tax hasn't changed since 2004

kluivert

Skoda Octavia 1.9 diesel will be even better value after July 08.

Curretn retail price for Ambiente model is 24250 + 375 metallic.

That off course includes 30% VRT. So take that out 24625 / 1.30 = 18942.31 add back in the new VRT rate for 130kg CO2 which is 16% > 18942.31 * 1.16 = 21973.08.

Too good to be true, I cant wait to see Skoda's new list prices in July 08.

niceirishfella

kluivert wrote: »

Skoda Octavia 1.9 diesel will be even better value after July 08.

Curretn retail price for Ambiente model is 24250 + 375 metallic.

That off course includes 30% VRT. So take that out 24625 / 1.30 = 18942.31 add back in the new VRT rate for 130kg CO2 which is 16% > 18942.31 * 1.16 = 21973.08.

Too good to be true, I cant wait to see Skoda's new list prices in July 08.

If this will be the price, its got to be the best value 1.9TD new car on the market?!

mike65

So good it won't happen, I expect dealers to "claw back" in (not so) clever and subtle ways. Like killing the spec on higher trim models, suddenly you'll be paying 500 euro for air-con again.

Mike.

fricatus

Will the forecourt price stay around the same though? Dealerships have this awful tendency to set their retail price (to what the market will pay) first, and then work backwards to the pre-tax price.

Even so... 25000 odd for a new car of the Skoda's size and quality is great value, so one or two grand off would be even better.

Churchy

Manufacturers set list prices not dealerships.

Dermo123

kluivert wrote: »

Skoda Octavia 1.9 diesel will be even better value after July 08.

Curretn retail price for Ambiente model is 24250 + 375 metallic.

That off course includes 30% VRT. So take that out 24625 / 1.30 = 18942.31 add back in the new VRT rate for 130kg CO2 which is 16% > 18942.31 * 1.16 = 21973.08.

Too good to be true, I cant wait to see Skoda's new list prices in July 08.

The 1.9TD Skoda currently has a 25% VRT rate not 30% as its exact engine size is 1896cc just below the 1900cc threshold where the rate is 30%. But there will be a good saving all the same

unkel

kluivert wrote: »

Skoda Octavia 1.9 diesel will be even better value after July 08.

Curretn retail price for Ambiente model is 24250 + 375 metallic.

That off course includes 30% VRT. So take that out 24625 / 1.30 = 18942.31 add back in the new VRT rate for 130kg CO2 which is 16% > 18942.31 * 1.16 = 21973.08.

Your calculations are wrong. See the new sticky. Also the current VRT rate is 25% (<1.9l) and not 30%. Based on your figures, the new price will be:

(24250+375) * (1-0.25) / (1-0.16) = 21987

niceirishfella

mike65 wrote: »

So good it won't happen, I expect dealers to "claw back" in (not so) clever and subtle ways. Like killing the spec on higher trim models, suddenly you'll be paying 500 euro for air-con again.

Mike.

I agree Mike.
Its a pity.....cos thats what the whole VRT shake up was meant to be about. Making lower emmission cars more attractive in purchase price and annual road tax.
If they jack up the price, the Budget VRT moves are a feckin waste of time.

maidhc

fricatus wrote: »

Even so... 25000 odd for a new car of the Skoda's size and quality is great value, so one or two grand off would be even better.

Is it? I was going to buy one a coiple of years ago, but I thought one with decent spec (e.g. aircon and alloys) was dangerously close to Toyota Avensis/Ford Mondeo prices.

A Mondeo is better value imo.

kluivert

Well dont forget this trend come July and just compare the new price to the new adjusted price.

If its 22k ill be ordering a new new for sure. In laws have a 1.4 06 Ambiente model and its so comfortable and easy to drive. Low on power but I want a diesel.

150e tax as well, jesus, cheap car value for money, thats the accountant in me thinking thats a great buy.

Henry Ford III

1.9 tdi is an ancient design. A bit of a tractor.

yellow012

maidhc wrote: »

Is it? I was going to buy one a coiple of years ago, but I thought one with decent spec (e.g. aircon and alloys) was dangerously close to Toyota Avensis/Ford Mondeo prices.

A Mondeo is better value imo.

Dunno where you got your prices from but a Skoda Elegance 1.9tdi which has dual zone climate control, alloys, a leather pack is currently €25920. The comparable spec Mondeo a 1.8tdci zetec is €31745 and the Avensis Aura 2.0 D4D is €30290 (for this price you don't even get alloys).
I am not trying to compare cars here as the Octavia is half a class down from the Mondeo and Avensis but there is a big difference in prices.

yellow012

Henry Ford III wrote: »

1.9 tdi is an ancient design. A bit of a tractor.

Yawn:rolleyes:

kluivert

unkel wrote: »

Your calculations are wrong. See the new sticky. Also the current VRT rate is 25% (<1.9l) and not 30%. Based on your figures, the new price will be:

(24250+375) * (1-0.25) / (1-0.16) = 21987

This is wrong as well. Thats bad maths there.

Am accountant dont argue with that.

24625 = 125% including VRT. To get 100% you divide by 1.25. which is 19700. To add on the new VRT rate mutiple by 16% or 1.16 equals 22852e.

I got the CC VRT rates wrong sorry about that but still cheap.

unkel

kluivert wrote: »

This is wrong as well. Thats bad maths there

.

Am accountant dont argue with that

Sic transit gloria mundi

Read the new sticky please...

E92

Unkel has worked it out correctly kluivert.(unkel, myself and plenty of other people have done plenty of examples on how to work it out, including the first page of the sticky on the VRT changes where unkel showed us all an example of the 320d)

I hope I don't use you as my accountant:D!

kluivert

unkel wrote: »

I should have spotted it is only 25% currently, not 30%. Formula:

32000 * (1-0.25) / (1-0.2) = 30000 (new price)

I have to disagree with your maths, sorry.

If you look up the price of a car in a dealer show room that is the price including VAT and VRT. 100% + 21% Vat + 20% VRT.

If a car costs 100e that means in percentage terms that equals 100%.

If you add VRT to that cost of the car, say 20%, that means that the cost of the car has changed to 120e or 120% (100% + 20%).

In order to reverse the VRT from the total list price you must divide it back out in order to get the original tax free cost of 100%. Therefore 120e divided by 120% mutipled by 100% is a 100e or 120/1.20 = 100.

To get the new cost of the car with the new VRT rate, say 16%, you take your tax free cost of the car, 100e and mutiple it by 16% or .16 which equals to 16e and therefore the new cost of the car is 116e.

Simple formula.

List price / 1. old vrt rate * 1. new vrt rate = new adjusted price of the car.

50000 / 1.30 = 38461.54 (price of car without VRT)

38461.54 * 1.20 = 46153.85 (price of car with new VRT rate).

kluivert

E92 wrote: »

Unkel has worked it out correctly kluivert.(unkel, myself and plenty of other people have done plenty of examples on how to work it out, including the first page of the sticky on the VRT changes where unkel showed us all an example of the 320d)

I hope I don't use you as my accountant:D!

Well your all wrong then.

I would like to see what its worked out because I dont agree with it.

I seen his calculations and there wrong. When you buy something with say Vat, to get the Vat exclusive price you divide the cost of the good by 1.21 to get the net cost without Vat, VRT is no different.

Come on, if something costs a 100e + 21% thats 121e in total that you pay. To get the net cost again you divide 121 by 1.21 to get 100e again. The prinicple is the same with VRT. So where you got that formula from for that calculation is incorrect. Simple as.

JHMEG

mike65 wrote: »

So good it won't happen, I expect dealers to "claw back" in (not so) clever and subtle ways. Like killing the spec on higher trim models, suddenly you'll be paying 500 euro for air-con again.

Mike.

We really should be compiling a (stickied?) list of cars and their current price and what they should be come July 1.

That way identifying who is robbing us the most should be easy.

alias no.9

kluivert wrote: »

This is wrong as well. Thats bad maths there.

Am accountant dont argue with that.

24625 = 125% including VRT. To get 100% you divide by 1.25. which is 19700. To add on the new VRT rate mutiple by 16% or 1.16 equals 22852e.

I got the CC VRT rates wrong sorry about that but still cheap.

I'm afraid another 'accountant', came up with the method of calculating VRT and it's based on a % of the open market sale price rather than a % on top of the pre tax price. The most cunning and devious of them all most likely did this to disguise the fact that the rates called 22.5%, 25% and 30% were effectively 29.03%, 33.33% and 42.86%. A nice little slight of hand designed to fool people into thinking they weren't being screwed nearly as hard by the government.

alias no.9

JHMEG wrote: »

We really should be compiling a (stickied?) list of cars and their current price and what they should be come July 1.

That way identifying who is robbing us the most should be easy.

Its all here and archived for previous years

E92

See the first post in this sticky. It is an ad valeorum tax.

In unkels' example of the 320d, it would cost €36,770 without VRT if we were doing it your way.

The same car in Germany costs €32,700. Even when this is adjusted for our VAT levels(21% compared to 19% there), it costs €33,250.

Under unkels' way the car would cost €33,460 which is exactly €210 more(and they are allowed to do this because they are allowed charge an RHD supplement, and as this example shows it is indeed quite a small one).

If we were doing it your way BMW would be charging a much high pre VRT price, and this would be contrary to Block Exemption, a major point of that was to standardise pre tax prices, and as can be seen here, BMW have already done this, so you can be certain sure that BMW will be passing on any VRT savings available, simply because they already make as much per car as they do anywhere else(unlike some other makers who still sell cars at a lower pre tax price for Ireland, and haven't yet standardised the pre tax price) in the EU.


From the SIMI:

Vehicle Registration Tax (VRT)


Vehicle Registration Tax is a duty payable on first registration of a motor vehicle in the State. The current rates are:

· 22.5% for cars with an engine capacity below 1400cc
· 25% for cars with an engine capacity between 1400cc and 1900cc
· 30% for cars with an engine capacity above 1900cc
· 13.3% for commercial vehicles with a gross vehicle weight below 3.5 tonnes
· €50 for other vehicles
· €2 per cc up to 350cc and €1 per cc thereafter for motorcycles.

Vehicle Registration Tax is applied ad valorem which means it is applied on a value which includes the tax itself. The value VRT is calculated on is the Open Market Selling Price (OMSP) which is essentially the expected retail price. This means that the real effect of VRT on the price of a vehicle is significantly more than the percentages outlined above: Breakdown of Tax Content of Car Prices
<1400cc 22.5% 1400cc - 1900cc 25% >1900cc 30%
Pre Tax Price € 9,970 € 15,397 € 23,624
VAT € 2,094 € 3,233 € 4,961
VRT € 3,502 € 6,210 € 12,251
Post Tax Price € 15,566 € 24,841 € 40,836
Tax as a % of Pre Tax Price 56% 61% 73%

All motor vehicles in the State must be registered with the Revenue Commissioners at which point they will receive a Registration Number. Once this number has been received your local SIMI dealer will affix the Registration plate onto your vehicle. A vehicle must be registered before it can be licensed for road tax purposes. If you purchase a new vehicle from an SIMI dealer the dealer will register your vehicle on your behalf and complete all the necessary documentation. The price of the vehicle will be inclusive of VRT and VAT.

cantdecide

alias no.9 wrote: »

22.5%, 25% and 30% were effectively 29.03%, 33.33% and 42.86%. A nice little slight of hand designed to fool people into thinking they weren't being screwed nearly as hard by the government.

There's no point in being transparent, that's just too easy.

JHMEG

alias no.9 wrote: »

Its all here and archived for previous years

Nice one. I've attached it in case it disappears..

Henry Ford III

yellow012 wrote: »

Yawn:rolleyes:

I agree entirely. Such ancient unrefined engine technology belongs in taxis.

unkel

Exactly!

And to do the sums for above example of the small engined car so everybody is 100% clear how it works:

9970 pre-tax price
2094 VAT (21% of the pre-tax price of 9970)
3502 VRT (22.5% of the total retail price including all taxes of 15566)

---

15566 Total retail price including all taxes


Total tax is (15566 - 9970) / 9970 = 56%