VRT takes in almost €1 Billion

Villain

VRT pulled in a huge €946 million in 2004, thats an increase of 15% on 2003. Surely it is now time that the government listened to the European Commission and started phasing this tax out.

With the exception of a few countries (Denmark & Finland), our european counterparts can buy car's at much lower prices. We already pay Road Tax along with very high levels of tax on petrol and diesel to fund the building of new roads plus a lot of new roads will carry tolls so surely the government can begin to phase this tax out and bring us into line with the majority of EU countries.

VRT is charged at 3 rates 22.5% on cars of engine size up to 1400cc, 25% on cars between 1400 and 1900cc, and 30% on cars above 1900cc. But it is levied as a percentage of the expected retail price, rather than the car’s basic cost. This means that VAT is first added to the price of the car before the VRT is calculated.

So Bascially if you but a car that has a cost before any taxes of €10,000 you first pay the VAT on that of 21% which brings the price to €12,100 then they take that to be 70% of the cost so add 30% and then get the ammount of VRT if this was a 1.6ltr car that would be €4,321 so the total cost would be

 (Cost)	   (VAT)    (VRT)  (Total)	
€10,000 + €2,100 + €4,321 =€16,421

Thats just crazy and a big rip off.

murphaph

irish1 wrote:

Surely it is now time that the government listened to the European Commission and started phasing this tax out.

....and replace it with what form of taxation?

Villain

murphaph wrote:

....and replace it with what form of taxation?

Nothing, we already pay enough taxes on road tax and petrol and as I said they plan to toll the new roads as well. I proposed a new road tax system in another thread a while ago where instead of everyone paying road tax dependent on the size of the car's engine it should be on milage, so those who use the roads more pay more, might help people use public transport a bit too, although I doubt it.

Zombrex

irish1 wrote:

Nothing, we already pay enough taxes on road tax and petrol and as I said they plan to toll the new roads as well.

Here here ... the only purpose for this tax would be to improve the current road system .. if the government go ahead with their plans to have a large number of new roads built with toll money (as PrimeTime showed that is actually a really bad idea, but that is another thread) then it is silly that we should have to pay this tax and pay tolls for the road system.

irish1 wrote:

I proposed a new road tax system in anotehr thread a while ago where instead of everyone paying road dependent on the size of the car's engine it should be on milage, so those who use the roads more pay more, might help people use public transport a bit too, although I doubt it.

Agreed, just like making recycling cheaper in dublin and having to pay for plastic bags in super markets people only get the message when they have to pay. A system like that would encourage people to use public transport and decrease the number of cars on the road

murphaph

irish1 wrote:

Nothing, we already pay enough taxes on road tax and petrol and as I said they plan to toll the new roads as well. I proposed a new road tax system in another thread a while ago where instead of everyone paying road tax dependent on the size of the car's engine it should be on milage, so those who use the roads more pay more, might help people use public transport a bit too, although I doubt it.

Bu that's not nothing. That's a different form of taxation. I'm not disagreeing with removing VRT but the tax has to come from somewhere or cuts have to be made in government spending.

red-rover

Wicknight wrote:

then it is silly that we should have to pay this tax and pay tolls for the road system.

Agreed, just like making recycling cheaper in dublin and having to pay for plastic bags in super markets people only get the message when they have to pay. A system like that would encourage people to use public transport and decrease the number of cars on the road

the Uk are doing precisely that, using GPS they plan to have it in place in a few years and charge on a per use basis. more miles, more money. sounds like a more equitable way of chargin tax and relieving gridlock. in parts of Dublin the cost will probably have the effect of a London-style congestion charge. the current tax system doesnt give any sense of fairness what so ever and some roads are rarely refurbished.
the only problem is that to justify any system of per milage taxation a feasible public transport system alternative must exist in some shape or form otherwise it can be seen as punitative.

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Red Rover...the blog

murphaph

red-rover wrote:

...sounds like a more equitable way of chargin tax and relieving gridlock.

But at least with punative fuel duty there was a better reason to buy a more economical (environmentally friendly) car. That reason is eroded with a slashing of duty because you'll have to pay per mile anyway. I believe the polluter should pay. Say you crawl for a mile in a congested town and pay £1.34 in your 5 Litre range rover, you'll pay the same £1.34 in a hybrid car. Ok, you'll spend slightly less on fuel but not that much less because most of the price of fuel is currently tax. It's too simplistic. A combination of both would be better I think.

ziggy

This post has been deleted.

A Dub in Glasgo

Yep, it seems a more logical answer to the problem. It will have to be done on an all-Ireland basis for it to be truely effective. The GPS solution as proposed by the British government is a nonsense and will cost far more money to implement than the increase on the fuel tax.

bonkey

ziggy67 wrote:

What about all road tax & VRT being scrapped and just pay all levy's through petrol/diesel. That way the gas guzzlers would have to pay more than the eco-friendly and it would be impossible to tax-dodge.

Yeah, but that wouldn't tax those who use the roads teh most, but rather those who use the most petrol on the roads.

I'm not saying its a right or wrong approach, but the cost of road-upkeep is surely determined by the mileage done on it more than the mpgs of the vehicles doing the mileage.

Is it fair that someone driving 30,000 km a year pays less than someone driving 10,000 km a year in cars that cause similar wear-and-tear to the roads, just because one is three times more fuel-efficient? Is it fair that as a car grows older you pay more for the upkeep of the roads (as fuel efficiency will drop over the lifetime of a car), despite not causing any extra wear-and-tear?

Maybe it is, but I reckon you'll find a lot of people disagreeing, and you'll have the cynics out in droves decrying such a system as nothnig more than the government sucking up to the automotive industry by trying to force a rash of new car buying.

jc

garthv

Surely it is now time that the government listened to the European Commission and started phasing this tax out.

Phase it out?Why the hell would the Irish Government want to do that?If its pulling in under a billion a year the last thing the Irish Governent are going to do is phase it out

Nuttzz

bonkey wrote:

Is it fair that someone driving 30,000 km a year pays less than someone driving 10,000 km a year in cars that cause similar wear-and-tear to the roads, just because one is three times more fuel-efficient?

but wouldnt that not encourage fuel efficent cars and have a positive knock on effect for the environment and help us meet our kyoto treaty targets?

remove VRT and it would be replaced by something else, its the price for living in a low personal tax environment

jammin

I used to work in a Vehicle reg office. All I have to say is ... yes, we do get fleeced buying a new car but then don't we get fleeced at every corner here in Ireland at the moment anyway. you should see the shock on a foreigners face when you tell them how much they have to pay to bring their car here. One guy actually thought I was offering him the price I was quoting him, he thought I wanted to BUY his car At least we know something about vrt or expect to be snared somehow but imagine suddenly being asked to pay out a few thousand euro before you've eaten your first Irish breakfast. (and it has to be cash I might add ) And then the first paper you see has a headline "Rip-off Ireland". Hmm .. who would you believe?
It's a little talked of Tax but when you think about it... how much better would our standard of living be in Ireland if we DIDN'T have vrt? It would be an amazing difference, for the better. Granted it's an easy billion for the government, but a government who will squander that billion faster than you can say..'national debt'. but that's a different story...