What if VRT was banished?

mcwhirter

Would anyone else prefer to pay extra tax on income, fuel etc if VRT was banished.

This is possibly the only way to re-ignite the car industry here, especially with the sterling being worth so little.

L1011

"What if VRT was banished?"

The state would go insolvent.

bennyx_o

You'd be paying a whole lot more for petrol and motor tax. Not worth it, IMO. If it bothers you, buy a used car

Matt Simis

bennyx_o wrote: »

You'd be paying a whole lot more for petrol and motor tax. Not worth it, IMO. If it bothers you, but a used car

Many used cars here are twice the price of cars in the UK, you dont dodge VRT buying used.

I wouldnt suggest VRT is abolished (although its contribution is probably overstated above), but rather aggressive cuts to the "tax" (and not just "green" cuts) along with some sort of rebate or incentive to Car Dealerships here (ie to help them clear stock).

L1011

Oh, and it'd also probably actually destroy the car industry as the second hand and pre-registered stock they can't shift suddently became worth thousands (more) less than they paid for it..

Victor McDade

God no. I'd rather pay more VRT and less income tax

Dob74

mcwhirter wrote: »

Would anyone else prefer to pay extra tax on income, fuel etc if VRT was banished.

This is possibly the only way to re-ignite the car industry here, especially with the sterling being worth so little.

Keep VRT the gov would only rip us off with some other tax. Since we do not have any car manufacturing why give them a break? Plenty of other places we could cut tax.

mcwhirter

bennyx_o wrote: »

You'd be paying a whole lot more for petrol and motor tax. Not worth it, IMO. If it bothers you, but a used car

But the vrt has already been added to the used car price, so the used car price is higher that an import due to that.
This is not a dig at the car dealers here, surely if the government reduced/scrapped vrt, then they could add the missing tax to another area.

If not then its bye bye to 2nd hand car dealers in ireland.

GavRedKing

With the way the Euro is against the Sterling the VRT i think is reasonable, i had bought a 01 Toyota Celica VVti-190 in June and paid 5,500 sterling and about 3,700 VRT working out at the time to about 11,000 for the car exchange rate was like 79cent or something. But now you could get the same car in england at a 04 reg and the VRT you pay would be ok considering the savings you make on the car.

If the VRT was abolished, as one poster said there would be a huge amount of second hand cars that would not be able to sell and the value would drop drastically.

More VRT less Income tax thats the way to go.

mcwhirter

gavredking wrote: »

With the way the Euro is against the Sterling the VRT i think is reasonable, i had bought a 01 Toyota Celica VVti-190 in June and paid 5,500 sterling and about 3,700 VRT working out at the time to about 11,000 for the car exchange rate was like 79cent or something. But now you could get the same car in england at a 04 reg and the VRT you pay would be ok considering the savings you make on the car.

If the VRT was abolished, as one poster said there would be a huge amount of second hand cars that would not be able to sell and the value would drop drastically.

More VRT less Income tax thats the way to go.

Maybe Income tax increases is not the only way, how about increasing tax on the old regulars like cigarettes and fuel, or even taxing us on crossing the border into the north:)

GavRedKing

mcwhirter wrote: »

Maybe Income tax increases is not the only way, how about increasing tax on the old regulars like cigarettes and fuel, or even taxing us on crossing the border into the north:)

I think people are kind of sick of the price of cigarettes and fuel going up, espically considering the fuel is only going doen in recent weeks over the price per barrell dropping. Its not a bad idea taxing people going over the border, keeps money in the economy. General cost of living has to come down and if that involves the VRT coming down then i for one would be all for it,its never that simple though.:(

daveharnett

Abolishing VRT overnight would trigger recession, even if we weren't allready in one.

Most cars would halve in value overnight. The government would take a massive loss of revenue - every existing dealer would go bust without major government aid.

Basically, to abolish it, you would need to drop it slowly over 5 years to avoid shocking the market, and to give the exchequer time to wean itself off the associated revenue.

Manufacturers could then start sending properly specced cars to Ireland, with proper engines, and VAT income would start to recover some of the lost revenue.

daveharnett

mcwhirter wrote: »

Maybe Income tax increases is not the only way, how about increasing tax on the old regulars like cigarettes and fuel, or even taxing us on crossing the border into the north:)

I like it. Let's abandon this 'free market' charade altogether:)

Mycroft H

mcwhirter wrote: »

Would anyone else prefer to pay extra tax on income, fuel etc if VRT was banished.

This is possibly the only way to re-ignite the car industry here, especially with the sterling being worth so little.

The goverment would have introduced another dozen sneaky taxes with it

mcwhirter

gavredking wrote: »

Its not a bad idea taxing people going over the border

That was a joke btw:D.
It would be impossible and also against eu rules.

Tipsy Mac

The problem is that VRT is now too strongly relied on to fund the rest of the economy. To abolish it now would decimate the remains of the motor industry here. It was let take too much of a hold of the industry in this country and SIMI have alot to answer for in backing VRT as they saw it as a way to control 2nd hand imports into the country, now it's limiting any opportunity for exports of unsold cars on their members forecourts to the UK market.

E92

Ironically enough, what would improve the secondhand market is if VRT was raised, or they went back to doing it on engine size for imports registered before 2008.

If the Government tried to make importing as unattractive as possible then that would get the secondhand market up and running again.

Problem with that though is that it would let the SIMI get away with selling inferior cars and artificially force up the price of used cars, and I certainly think the SIMI are owed an enormous kick up the arse by the public, though if people got more for their trade ins then they would buy new cars and that would make the Government money and would help keep people in the motor trade employed.

I can't stand the SIMI because I believe that they treat we the public like sh!t and would appear to represent the various dealer association rather than the many parts that are involved in the trade but I am genuinely concerned that ordinary people are losing their jobs over something that is outside of their control.

While I am relieved that people are finally not allowing themselves to be ripped off and now actually look for value in things at last I am also concerned that taking money out of the economy is not a very good thing to do, and that's exactly what is happening with all the used imports.

If VRT was removed then people who want very nice but completely saleproof cars could actually buy them because the UK is far more receptive of high spec bug engined cars than we are and dealers could export any cars like this that we would consider undesirable but would sell over there and while in the short term it would be extremely painful to do this because it would devalue used cars even more which I think we all agree is the last thing we need to do now; in the long term it would be in everyone's interest that we get rid of VRT and have a free market.

ninty9er

E92 wrote: »

If VRT was removed then people who want very nice but completely saleproof cars could actually buy them because the UK is far more receptive of high spec bug engined cars than we are and dealers could export any cars like this that we would consider undesirable but would sell over there and while in the short term it would be extremely painful to do this because it would devalue used cars even more which I think we all agree is the last thing we need to do now; in the long term it would be in everyone's interest that we get rid of VRT and have a free market.

The issue of aboloshing VRT isn't that dealers would collapse. Any decent main dealer with a loyal following for the past 10-15 years should be sitting on upwards of €1m in reserves, for the purposes of threats as defined by SWOT analysis.

If the cars are devalued to crap it has a balance sheet effect, yes, but they are not cash in the bank sitting on the forecourt, they are already paid for (in theory). Making a loss on them will not disimprove the cash position of a dealer. At the moment €2,000 in the bank is a whole lot more desirable than a 5 year old 3 Series that's been driven to sh1te that got a trade in value of €7,000.

The dealer has essentially paid the €7,000 and is down that money, getting €2k for it is very worthwhile, though it doesn't look good on a balance sheet. I've dealt with MDs in my work-placement last year that are horrified when the partner in charge of their accounts tells them they'll have to make a loss or transfer money inter-company. They'll prefer to make no profit on 2 companies than a loss on one and a profit on the other. This is just plain silly beggars. Taking a loss to your balance sheet is vital in times like this. Cash is king, not a 5 year old Beemer that won't shift for anywhere near what you allowed for it.

Your financer won't want the Beemer when your next quarterly installment is due, they want cash! The sooner you clear it the sooner you have room to put something decent in its place and at a decent price.

Removing VRT is in the overall interest of the motor industry, but I don't reckon it makes sense to the economy until we're probably twice as densely populated as we are now with over 4 million at work, and that's about 40-60 years off.

The revenue generated by VRT is paying for doctors, nurses, Gardaí and lamp-posts as well as roads. It's a necessary evil until such time it's more advantageous to go out and pay 17% tax than sit at home on your arse.

Higher income taxes are here already for the wealthy, but they will have to get 4-5% higher and the lower income bracket will have to fall by a similar margin to incentivise work to the extent that income taxes jump significantly.

Personally I'm in favour of this, but some would have you believe paying 47% on the portion of income over €85k would encourage people to go on the dole, which is just bull.

Also, motor tax would have to go first to test the water.

ART6

ninty9er wrote: »

The issue of aboloshing VRT isn't that dealers would collapse. Any decent main dealer with a loyal following for the past 10-15 years should be sitting on upwards of €1m in reserves, for the purposes of threats as defined by SWOT analysis.

If the cars are devalued to crap it has a balance sheet effect, yes, but they are not cash in the bank sitting on the forecourt, they are already paid for (in theory). Making a loss on them will not disimprove the cash position of a dealer. At the moment €2,000 in the bank is a whole lot more desirable than a 5 year old 3 Series that's been driven to sh1te that got a trade in value of €7,000.

The dealer has essentially paid the €7,000 and is down that money, getting €2k for it is very worthwhile, though it doesn't look good on a balance sheet. I've dealt with MDs in my work-placement last year that are horrified when the partner in charge of their accounts tells them they'll have to make a loss or transfer money inter-company. They'll prefer to make no profit on 2 companies than a loss on one and a profit on the other. This is just plain silly beggars. Taking a loss to your balance sheet is vital in times like this. Cash is king, not a 5 year old Beemer that won't shift for anywhere near what you allowed for it.

Your financer won't want the Beemer when your next quarterly installment is due, they want cash! The sooner you clear it the sooner you have room to put something decent in its place and at a decent price.

Removing VRT is in the overall interest of the motor industry, but I don't reckon it makes sense to the economy until we're probably twice as densely populated as we are now with over 4 million at work, and that's about 40-60 years off.

The revenue generated by VRT is paying for doctors, nurses, Gardaí and lamp-posts as well as roads. It's a necessary evil until such time it's more advantageous to go out and pay 17% tax than sit at home on your arse.

Higher income taxes are here already for the wealthy, but they will have to get 4-5% higher and the lower income bracket will have to fall by a similar margin to incentivise work to the extent that income taxes jump significantly.

Personally I'm in favour of this, but some would have you believe paying 47% on the portion of income over €85k would encourage people to go on the dole, which is just bull.

Also, motor tax would have to go first to test the water.

I agree with everything you say, but the fact remains that this is just another of the many cases where the government again imposes a tax on money that has already been taxed at least once. In my view doing that is a political expedient to sidestep the people fully realising just how much of their income is grabbed by the Revenue. VRT is a cheating tax, particularly when VAT is added to it. If you tried such a dodge in a private company they'd have you for fraud:mad:

mickdw

You cannot abolish vrt overnight as it would be a disaster for carowners & dealers alike.
I believe the only option now is to increase vrt marginally to make some of the curent used stock look better value. Then to deal with the problem of cheap import cars, they could put an additional tax on those of about 15%. This tax could be for the additional checks/verification that might need to be done on the used import to ensure its a genuine car with correct mileage etc. They could insist on a thorough mexhanical check on any used car coming for registration all covered by this 15% extra tax.
This would solve most of the current probs as I see them.
Also the road tax bands will change surely change v soon. Nobody in government intended having executive cars on 150 euro tax. If they could move to a dual system based on co2 together with cc, Id say they would

ninty9er

Vehicle re-registration tax.....VRT multiplied by 2 for any vehicle previously registered in another state.

junkyard

The government has killed the motor-trade here anyway now, just like farming, fishing and pretty much all other bussinesses here.

Eric Cartman

i dont mind the vrt but fix the fúckin OMSP values

positron

This is the last place I thought someone would suggest 'increasing' the VRT! While most of the points above make logical sense, but would this not, ultimately increase the motoring costs for average Joe? Protectionism just alienates those who are not being protected, imho.

Our man in Havana

MYOB wrote: »

"What if VRT was banished?"

The state would go insolvent.

That is going to happen anyways with all the VAT being lost to Her Majesty's government from cross border shopping.

Car-dealer

my 2 pence:

Mr and Mrs Average in Ireland are paying not far off twice as much for their family car as folks in the UK - then when Mr and Mrs Average go over to the UK to avail of the free market, the Irish Government sneakly nab them on the way back to rake an unjust and unfair tax off them (VRT), and even worse use over inflated market values (OMSP) drawn up in cahoots with the motor industry, so that the double price of Irish cars remains in force: yes the Government benefit to the tune of €1.5 billion per year. Oh yes the 1 EU market thingy - thats sheer bollox as a result of VRT.

But let me tell you where some of that money goes:

Irish doctors are overpaid compared with european doctors: the new contract for consultants with a basic salary of €250,000 per annum is just wrong in my book, an average consultant in the UK earns around €100,000, so you could get two for the price of onel; and then compare that across Europe and its out of wack.

Ministers in the Government earn far too much, compare the P.M.s salary in the UK with that of the Ts in Ireland?

Money is wasted: crazy land buys in the 1990s, machines for voting that have never been used. ect ect

So, how can anyone on this site say that VRT is a good thing, because let me tell you who suffers, Mr and Mrs Average Eire!

I used to be a very proud Irish guy - but let me tell you something, I recently got sick and spent a few weeks in hospital in Wexford General hospital, for the first three nights I was left on a trolley in the main entrance hall way, not to put a too fine point here, but I could have died. The nurses were overstretched, the doctors were sending sick people home, someone on a trolley next to me with a serious lung infection was sent home, the consultant asked her to write a letter of complaint. I dont know whats happened to our small country, with terrible health services and serious widespread crime, its not quite the place I was very proud of once, but I hope it comes back again. Now regarding VRT, if the Government are going to set an agenda of bypassing EU laws and ripping off the Irish people, what kind of example does this set for the rest of us; I have paid a lot of VRT in my small car business, yet look at how I got treated in hospital; its made me more inclined to find ways to cheat the tax system, but Im too honest to be dishonest: in my view all wrongs must be put right, including VRT! We want a country we can be proud of, not one we mistrust or hate - thats the real problem with VRT.

RiverWilde

Between the depreciation, the vrt and the road tax, I'll never buy a new car in this country. If the dealers can't compete in an open and fair market then they do not deserve to be in business. VRT is a crutch provided by the govt. and the sooner it's taken away the better.

Riv

mcwhirter

Tipsy Mac wrote: »

The problem is that VRT is now too strongly relied on to fund the rest of the economy. To abolish it now would decimate the remains of the motor industry here. It was let take too much of a hold of the industry in this country and SIMI have alot to answer for in backing VRT as they saw it as a way to control 2nd hand imports into the country, now it's limiting any opportunity for exports of unsold cars on their members forecourts to the UK market.

If the VRT was designed to control 2nd hand imports, was that when the Irish punt was worth a lot less.
The government have made a massive mistake with this policy as now the irish currency is worth a lot more.

They are doing the same with increasing VAT rates, income levies etc.

I suggest to increase income tax overall, reduce VAT levels, get rid of VRT.
This will give us less money in our pocket, but overall, living costs will drop, food and goods will be cheaper, more money will enter Ireland from abroad and we should feel wealthier.
What is the point in keeping income taxes low when a lot of the money is being spent in another country.
I have a friend in Germany and are lot of their income is taxed, but living costs are so much cheaper than here, that they fell better off.
Britain is similar, the Irish government need to quickly change their policies.

mumblin deaf ro

I don't work in the car industry, but from the outside it seems that the poor value of trade-ins is what is keeping people away from the forecourts. I won't buy a new car if I'm going to get very little for the one I'm trading in.

VRT is probably more of an issue for the many people here who buy or want to buy in the UK, so i doubt the Govt is going to drop VRT to help you lot.

Biro

gavredking wrote: »

With the way the Euro is against the Sterling the VRT i think is reasonable, i had bought a 01 Toyota Celica VVti-190 in June and paid 5,500 sterling and about 3,700 VRT working out at the time to about 11,000 for the car exchange rate was like 79cent or something. But now you could get the same car in england at a 04 reg and the VRT you pay would be ok considering the savings you make on the car.

If the VRT was abolished, as one poster said there would be a huge amount of second hand cars that would not be able to sell and the value would drop drastically.

More VRT less Income tax thats the way to go.

But you have to look at the whole picture. You have car x, worth €9000. You took it as a trade in for car y, sold for €11000. VRT goes, now car y would have been worth €8000 and car x sitting there is now worth €6000. People think "Oh you've lost €3000" but that's not the case. The next car that comes in is worth less too, so the cost of the next customer to change is the same as it would have been before. You're not out any money. If everything devalues then you don't loose.
This country seem incapable of understanding the big picture. "Oh, I'm so great - I bought a house a year ago and now its worth €100,000 more than I paid for it, aren't I the clever boy?" was what was been said for the last 6 years. In actual fact the next house you were going to buy went up by the same amount, so it cost the same to change houses as it would have had your house stayed the same price. Now it's come crashing back down again, and people think they've lost.
You can't win or loose on anything unless you're buying with nothing else to sell or selling with nothing else to buy.
The only thing bad about getting rid of VRT is the loss the government would take. That's bad for the country, whether we like it or not. In other ways it would help the dealers cause people would no longer go to the UK for a car cause it'd be more or less the same price here.

Del2005

mickdw wrote: »

Also the road tax bands will change surely change v soon. Nobody in government intended having executive cars on 150 euro tax. If they could move to a dual system based on co2 together with cc, Id say they would

That's very easy. Just add the cost to fuel. Big cars with big engines doing big kilometerage will pay more and small cars with small engines doing small kilometerage will pay less. It's green and easy so will never happen.