VRT, the madness continues!

jmc19 · 12-05-2011 3:51am #1

Just after coming across this via a link here on the boards, I have to say I find it absolutely ridiculous what the VRT/Revenue are it.

http://www.irishtimes.com/newspaper/motors/2011/0427/1224295540050.html

The Irish Times - Wednesday, April 27, 2011

How much VRT on an imported shell?

From DS: I rang Monaghan’s VRT office back in September 2010 to find out how to go about registering a 1992 Ford Escort Cosworth shell as it was from the UK. At the time they gave me a VRT figure of €5,900 but said it may be less as they were valuing the VRT on a complete, running 1992 RS Cosworth. I was happy with that and was told I could continue with the rebuild and this would all be worked out when the car was completed.

I was later told by another VRT office that what I was told in September 2010 was wrong – I would have to go an NCT centre for them to assess it and calculate the VRT price.

But the NCT centre can’t work out the VRT for it as they say it is not a fully complete, running car. After a lot of calls to various departments, I then get told that because the “car”, is in the country more than seven days I would be fined as I’m breaking the law.

Finally, someone in Revenue told me that it has to be fully rebuilt for it to be VRT’d at an NCT centre, as they will only VRT it when it is a fully complete, running car. I explain the whole shell saga to him to be told that the last good condition Cosworth he looked at for VRT he valued at €25,000 giving a VRT rate of €9,000. I’m then told that as mine is being rebuilt to such a high standard and will be better than its original intended build form, and that it is a one-off, it will be valued at the highest rate as a concourse car of €40,000-plus, meaning the VRT on it would be anything from €15,000.

Do you have any idea if the information I’ve received so far is correct?

We contacted Revenue on your behalf and they came back to us first with an apology for you, which we believe you’ve received for the confusion, but also with the following information.

“To be registered, a vehicle must satisfy the definition of ‘mechanically propelled vehicle’. One of the prerequisites of that definition is that it is capable of achieving vehicle propulsion at the time of registration to the satisfaction of the Revenue Commissioners’. Therefore, the Cosworth shell was not a “mechanically-propelled vehicle” and couldn’t be registered, and the NCTS would, correctly, refuse to register it.

“We no longer provide a speculative valuation service to those intending to register vehicle, ie, someone can’t value a vehicle accurately based on a phone call or cursory information relating to the vehicle.

“Instead, where we do not have a valuation on our website, we have published on our website the methodology used by Revenue. Additionally, in order to help an individual who may have an esoteric vehicle for registration, we have provided a form to guide them in the self-estimate.

“The main things that determine the valuation of a vehicle are: its open market selling price (OMSP), and that depends very much on the characteristics of the vehicle, make, model, version and variant and what it might fetch on sale in the State; the level of CO2 emissions; its condition, and in this, a badly-restored vehicle, it will have a lower OMSP than a well-restored one and will have a lower VRT charge; and finally its mileage.

“The engine size does not impact on the VRT charge unless it has lower emissions (and we determine the VRT on the emissions at the time of manufacture, not the later modification of the vehicle) and it is likely, in this particular case – unless we have satisfactory documentary evidence of the CO2 of the vehicle at manufacture – it will be charged at 36 per cent of the OMSP.

“When the vehicle is completed or when it satisfies the definition of a ‘mechanically-propelled vehicle’ and is presented for registration, Revenue valuation officers will have to determine the value.

“Because of this, the vehicle won’t be registered on the first visit and it will necessitate a second visit to the NCTS to pay the VRT charge that will be determined after the vehicle has been valued by Revenue’s valuation officers. Your reader will then be able to complete the registration of the vehicle.”

Is VRT not illegal ?

Secondly, with the VRT rate in the said article, you have to wonder how the country is broke and where money like this is going?

sid131 · 12-05-2011 8:50am

My god!!!!:mad:
thats why there are tax books for sale;)
thats pure madness:eek:

wildefalcon · 12-05-2011 9:11am

So, they tax the guy on all his hard work, then take his pension fund, and give all the money to the banks?

Why are we still living in this country?

Atomic Pineapple · 12-05-2011 9:43am

sid131 wrote: »

My god!!!!:mad:
thats why there are tax books for sale;)
thats pure madness:eek:

Please dont suggest anything illegal on Boards.ie.

hellboy99 · 12-05-2011 12:11pm

That's my brother the article was done on, a joke is what it is, you have to wonder how the country is broke with stunts like this :rolleyes:

Here is the response my brother got and his reaction;

can be view here: http://bbs.rsownersclub.co.uk/showthread.php?t=338914

And here is what I have been told from the head of Revenue:

Speaking myself to the Head of VRT here in Ireland a few weeks back, firstly he apologise for the whole mess and the near months worth of calls to and from every department imaginable, still waiting on the written letter of apology, won't be seeing that me thinks

He went on to tell me that above mentioned information with regards to bringing in a shell was incorrect and that the bringing in of a shell was stopped in 1993. In 1993 a new VRT rule was brought in were all cars now to have VRT paid on them have to be mechanically propelled, meaning you cannot VRT just a shell or a full build car that is not mechanically propelled.

With regards to VRT OMSP (open market selling price) valuations, he gave me two current valuations for a Ford Escort Cosworth, one at £22,000 sterling and the other at £27,000 sterling. So based on them figures you’re looking at a VRT rate of €9000 - €11,000 but when my car is complete I could be looking at paying up to €15,000+.
As you can imagine I asked why he was using “UK sterling” values as VRT rates can only be worked out using the Irish OMSP, not only this but going by the two mentioned figures Revenue are currently using they must be looking for dearest cars they can find.

With regards to the highest rate of VRT I could be looking at €15,000+ as my car would fall under the category of a concourse car of €40,000plus. Now where this has come from I don't know, just have to look at two cars for sale here in Ireland that condition wise I would class at the high end of the scale:

€18,000 - http://cars.donedeal.ie/for-sale/cars/1982106

€17,995 - http://www.buyacar.ie/car-200

Also the reason for the high value I was given for mine is that, and this coming from the guy in Revenue that values these types of car, and I quote; "cars are the new investment scheme here in Ireland, that's the reason for the high valuation".

Now I rang a few Ford dealerships here looking the for OMSP and the valuations I have gotten from them is that you can buy a very good condition to concours standard Cosworth for €10,000 - €18,000. When I told them what sort of nonsense I've been told you can image the response I got.

So there you have it guys, I was more than happy to originally pay €5,900 on the shell only to be told it now couldn't be done. Now the "nice" people in Revenue want me to pay anything from €10,000 - €15,000+ VRT on a car that's being built here in Ireland using parts sourced here, be they new parts that I have already paid tax on or second hand parts that cannot have tax applied to them, even though I might be able to appeal the VRT rate with the Revenue, if I win the appeal I would only get back 10% - 20% of the VRT rate. Absolute joke if you ask me and it's clear the figures I'm getting back from VRT are been "pulled out of the air".

Don't get me wrong, I'm more than willing to pay VRT, I'm not looking for a way out of it but I'm sure as hell not going to pay an extortionate rate of €10,000 - €15,000+, sure I can buy a excellent condition fully running Cosworth for that!

hellboy99 · 12-05-2011 6:52pm

draffodx wrote: »

Please dont suggest anything illegal on Boards.ie.

If you ask me VRT here is illegal and just looking at what is happening to my brother it's clear to see that the VRT system is just a money making racket.

Mr. Presentable · 12-05-2011 6:55pm

hellboy99 wrote: »

If you ask me VRT here is illegal and just looking at what is happening to my brother it's clear to see that the VRT system is just a money making racket.

Yeah, but it's not, so good thing you're not being asked!

hellboy99 · 12-05-2011 7:51pm

Mr. Presentable wrote: »

Yeah, but it's not, so good thing you're not being asked!

Can you prove that VRT is legal then?

cossiedevil22b · 12-05-2011 7:53pm

Hey this would be me that got this VRT rate and would have to say after spending over 3 weeks solid on the phone to revenue and get buck passed from one office to another to hit a brick wall every time and also i have to say if in my work i did this to a customer i would be fired.Also the fact aswell that all the above people i was talking to could have helped me but did not as i was told already by someone who works in the public sector that this always happens as they do the best not to help you. And i did get a phone call from Kieran Dillon head of revenue to get a sort of apology but only after the irish times where in contact with them.

Also just to quote Mr. Presentable

VRT is illegal in a way, how can the European Union impose a fine to the state every year for charging VRT. It works out that the fine imposed is less than what the government takes in on VRT for the first month of the year.

Atomic Pineapple · 12-05-2011 8:46pm

Next person to suggest VRT being illegal will be getting a ban and this thread will be closed, its been done to death on the motors forum and another thread is not going to lead anywhere.

cossiedevil22b · 12-05-2011 9:09pm

draffodx wrote: »

Next person to suggest VRT being illegal will be getting a ban and this thread will be closed, its been done to death on the motors forum and another thread is not going to lead anywhere.

Sorry draffodx didn't realise there was an infringement of freedom of speech here on the board,aplogies again.

Atomic Pineapple · 12-05-2011 10:00pm

cossiedevil22b wrote: »

Sorry draffodx didn't realise there was an infringement of freedom of speech here on the board,aplogies again.

There isn't, do a search on VRT and you'll get all the opinions you want, there's no need to regurgitate them here again.

You'll also find tons of information on VRT itself and it legalities and legal implications. VRT is not illegal and several other countries in the EU have similiar set ups.

Feel free to discuss your situation but there is no point in discussing the legality of VRT, it wont change anything and all the info you could ever need is already posted on Boards.

cossiedevil22b · 12-05-2011 10:26pm

Im not going to get involved with this as i have never been in trouble on any site in the fifteen years of using the web and im not starting either.But on dealing with revenue and the irish times my issue if you read it is not with trying not to pay vrt but to pay a realistic figure as i was willing to pay €5900 for the car as is but this was turned down for nearly €6000 to be turned down on a nearly 20 year old car is amazing and then also to find out that most escort cosworth here never even paid as much as that figure.i would like the mods to delete me please from the site.

Atomic Pineapple · 12-05-2011 10:31pm

cossiedevil22b wrote: »

Im not going to get involved with this as i have never been in trouble on any site in the fifteen years of using the web and im not starting either.But on dealing with revenue and the irish times my issue if you read it is not with trying not to pay vrt but to pay a realistic figure as i was willing to pay €5900 for the car as is but this was turned down for nearly €6000 to be turned down on a nearly 20 year old car is amazing and then also to find out that most escort cosworth here never even paid as much as that figure.i would like the mods to delete me please from the site.

I agree with you, the service seems to have gone even further down the drain since it was handed over to the NCT centres to value the cars. And the issue of the lack of a quality service certainly deserves to be raised.

jmc19 · 12-05-2011 10:31pm

cossiedevil22b wrote: »

Sorry draffodx didn't realise there was an infringement of freedom of speech here on the board,aplogies again.

draffodx wrote: »

There isn't.

Feel free to discuss your situation but there is no point in discussing the legality of VRT, it wont change anything

Sounds to me like an infringement.

Thats whats wrong with this country, corrupt people with a bit of power robbing the public, hiding the truth and shutting up members of the public.

Good on you Cossie I say, we need more people like you, people that will no longer tolerate the current joke which is Ireland and who take it upon themselves to highlight the injustices that go on here and will go on for years to come if we do not collectively take a stand! Best of luck to you Cossie

Boskowski · 12-05-2011 10:32pm

Well my stance would be - and sorry for my ignorance - if it's not a mechanically propelled vehicle I won't be paying any VRT. End of problem solved.

Atomic Pineapple · 12-05-2011 10:36pm

jmc19 wrote: »

Sounds to me like an infringement.

It isn't. If it was all the info thats already here would be deleted.

Now please no more de-railing of the thread or it will be closed.

jmc19 · 12-05-2011 10:55pm

draffodx wrote: »

I agree with you, the service seems to have gone even further down the drain since it was handed over to the NCT centres to value the cars.

It's not the NCT that are valuing the cars, it's the Revenue.

galwaytt · 12-05-2011 11:26pm

Cossie - I feel your pain. I had an issue many years ago with an Audi Coupe Quattro I had in storage for 10 years here, and the non-payment of road tax.

Long story short, someone else in the same predicatment - a Triumph Herald in Dublin, no less - took the Dept to court, and won, and on foot of that I got my car registered and taxed with zero arrears.

No help to you, but I'm only using it to illustrate the fact that sometimes, sometimes, change can be effected. But it takes a big effort to do it, and bravery - there's no guarantee you'll win. I spent 2+ years in my battle, and 100's of letters, but it was bloody hard work.

I swore I'd never get involved in anything like it again, but atmo, I have to say, I'm contemplating doing something like it again, over Motor Tax.

Right now, you are back worse than where you started, so I don't know what your options are. Realistically, it looks like do the project, and export it. Maybe by the time you have it ready, a newer angle may present itself. Otherwise, the time/energy your project will require will disappear in dealing with faceless people in Department's.

Can I offer the following advice generally as well, on dealing with Dept's: first, always, always - get the name of the person you're dealing with, right at the start. If they mutter it (and some do), make them repeat it. If they give you their christian name, - ask for their surname. And write it, the date, and the time of the call down. All dept's function on record keeping.......by starting out as above you're putting them on notice that it's going on record, and in the worst case, you'll have a credible record for future reference. I cannot stress that process enough. And if you get a good helpful person - thank them. They will impart info to you more easily.

We are getting to the point, fellow petrolheads, where we're going to have to get off our asses and DO something.

Otherwise, if they feel free to put their hand in your pension, then pleading over old cars/etc is fruitless.

hellboy99 · 13-05-2011 12:15am

I've done a bit of work in helping with this for my brother when he was at work and the amount of buck passing and people not knowing what their job is or the policies in place is unreal.

In one day of phone calls on his behalf, in just under 4 hours I got absolutely nowhere. Here is the outlay of them 4 hours:

- Started off with his local VRT office.
- Then onto the tax office.
- Back onto the VRT office.
- Then told to ring the NCT office in Dublin, nothing to do with them.
- Ring back the VRT office.
- Told to ring Rosslare.
- Back to the local VRT office.
- Then back onto Rosslare and spoke to another unhelpful person.
- Told to ring NCT, so ring them back.

At this stage I'm fed up completely with this so I rang the Europa EU help desk to find out who exactly is responsible for dealing with this. Outlined the numerous calls already made that day to them, person I spoke to there couldn't believe what was going on so suggested I ring the Ombudsman here so I did that:

- Rang the Ombudsman, nothing to do with them and they couldn't help, told to ring Revenue in Rosslare.
- Ring Rosslare to be told to ring the NCT, told them that the NCT had nothing to do with it so they told me to get back onto his local VRT office.
- So I do that, back to square one again, nothing to do with them that it is Rosslare I need to speak to.
- Back onto Rosslare only to be told to ring Dublin Chamber of Commerce.
- So I ring them not that it has anything to do with them and got speaking to a lovely lady there who wanted to know why I was told to ring them. I explained to her the situation, she couldn't believe it and was so shocked that she went out of her way to try and help by getting contact numbers of places that might be able to help.

So there you have it, the people employed to do the job that is needed when it comes to VRT/Revenue, the very ones that moan if their wages or pension are to be cut, not one had a clue or were bothered to help, and the most helpful person of the day was a very helpful women who's job role had nothing to do with the matter at hand.

hellboy99 · 13-05-2011 12:27pm

Apologies for this as it's sort of a bit of track, but what is the deal VRT wise on a kit car build does anyone know?

Atomic Pineapple · 13-05-2011 12:29pm

hellboy99 wrote: »

Apologies for this as it's sort of a bit of track, but what is the deal VRT wise on a kit car build does anyone know?

Some of the lads over on http://www.octane.ie might be able to answer that question, I think a few of them have kit cars.

hellboy99 · 13-05-2011 2:21pm

draffodx wrote: »

Some of the lads over on http://www.octane.ie might be able to answer that question, I think a few of them have kit cars.

Thanks for that Draffodx, just looking over there and came across this:

Firstly they dream up an OMSP for the car i.e a Murtaya (subaru WRX based kit) costs £23,000 fully built by the factory in England so they'd give that a ridiculous Irish OSMP value of say 40,000 euro new.

Then they charge you VRT based on the CO2 emissions of the engine used. Therefore if you were using a 1998 WRX engine they'd want to charge you 36% of 40,000 euro. Which is roughly 14,000 euro!!! As per usual a total joke. A kit that would cost you £13,000 to buy in England and say £5,000 total to finish (i.e Donor Subaru and tools) would end up costing you £18,000 as an englishman but 33,000Euro as an Irish man.

Just asking this for a friend that was asking me this morning about kit cars, hearing lots of stories this last few weeks and getting questions now that this hit the paper. Anyway, he the rang Revenue himself about it today and has asked that I post this up for him as he's not registered here and he basically wants to add his own dealings with VRT/Revenue to this thread.

So he rang up today asking about how VRT on a kit car build would work. The VRT will be done when the car is built and presented to his NCT centre, a VRT rate will be calculated on the engine CO2 emission and then on the valuation of the car. This is were it all gets a bit strange, he asked about how the valuation would be done as he believes it would be the first one in Ireland so what OMSP do you base it on, person he spoke was not sure, all he got back was that there is a "specialist" person that VRT/Revenue contract in to do this.
So as you do he asked to speak to this person only to be told that he does not deal or talk to members of the public nor would he give a rough valuation or a rough idea on what VRT he could be looking at paying, WTF

So there you have it in a nutshell :mad: So we have a "so called" system in place, be it online, over the phone or visit your local VRT office to obtain the information you need, the information that is suppose to be provided by the pubilc/state sector body put in place to members of the public that our taxes pay for, only to be told "we are not going to give you the information you seek or let you speak to the person that deals with this".

There's another wastage of our taxes if you ask me, no point having VRT/Revenue offices if no one wants to help or deal with a member of the public :mad:

jmc19 · 13-05-2011 5:28pm

@ hellboy - that's unreal, whats the point of having Revenue and people working there if they do not want to help :mad:

@ cossie - regards to the VRT price and revenue OMSP values;

There was an article done in the Sunday Business Post back in 2009, now before the mod jumps in and says it's too old, not relevant, done to death etc....

please just take a second to read it and it is relevant to this thread.

Sunday Business Post, June 14, 2009

By Kieron Wood

The European Commission has begun proceedings against Ireland for infringing EU law by charging vehicle registration tax (VRT)o n vehicles imported from other EU member states.

The Revenue Commissioners charge VRT based on a notional ‘‘open market selling price’’ of imported vehicles, rather than the actual purchase price.

The open market price would typically be higher than the purchase price, resulting in higher VRT for the purchaser. VRT is charged at rates of up to 36 per cent, depending on a vehicle’s emissions.

Second-hand car dealers have long been critical of the method of calculating the VRT rate. In 1998, Niall O’Dowling of Used Car Importers of Ireland (UCII) brought High Court proceedings against the ‘‘secretive and arbitrary’’ way the tax was imposed. He claimed there was unfair discrimination in favour of the importers of new vehicles.

O’Dowling said that the distributors of new vehicles decided their open market selling prices, on which VRT was based. But the Revenue Commissioners calculated the open market price on second-hand vehicles, based on 25 unpublished ‘‘depreciation scales’’.

The Revenue claimed the open market price was the price a car might reasonably be expected to sell for on the retail market, and said it administered the VRT system ‘‘objectively and impartially’’. In 2005, it was ordered to provide all the relevant documents to UCII. At a hearing in 2006,Miss Justice Mary Laffoy said: ‘‘Unfortunately, the enthusiasm for a speedy resolution of the matter, which obviously inspired that order, seems to have dissipated.”

O’Dowling said last week: ‘‘We received a letter of confirmation from the EU Commission last week. The proceedings go back to a complaint registered in 1999. I would expect that the investigations are now at an advanced stage, given the time span involved.”

A spokeswoman for the Directorate General for Taxation and Customs Union in the European Commission confirmed that the Commission had opened proceedings, but added: ‘‘No public information is available at the moment.”

Total net receipts for VRT rose from €820 million in 2003 to a high of €1.4 billion in 2007. This year, VRT receipts have collapsed, with provisional figures of €240 million for the five months to May 31 - equivalent to an annual drop of almost 60 per cent.

The bit I put in red Cossie, in your case I think it is safe to say that what they have stated and this is suppose to be the practice still to date is not what they are applying to your case. How they can ask you to pay VRT of up on €15k or more for a car that currently has an OMSP here of €10k - €18k is ridiculous.

To date the EU proceedings against Ireland's VRT system are still active, they may be going a bit slower due to the fact we owe them so much money and the IMF are now in, but these proceedings are ongoing all the same.

Not only this but there is Inishowen anti-VRT campaigner by the name of Ryan Stewart, he's on Facebook and has a VRT campaign thing set up there also.

http://www.inishowennews.com/011VRTprobe132.htm

In March of this year The EU Committee on Petitions confirmed that it would launch an investigation into the two specific issues regarding VRT. The fact that the EU Petitions Committee deems the cases admissible shows that it feels there are serious flaws here regarding VRT, and this on top of the other proceedings just goes to show that the EU do indeed think there are serious problems with our VRT system.

Hopefully soon something will come of it and cases like yours coming to the EU's attention adding more fuel to this fire will hopefully speed proceedings along.

@ draffodx - please don't ban me for the following and if so please do not lock this thread, it's a valid point to make and will not have people viewing this thread or new comers to it having to search round for info on the legality of VRT.

When the European Commission begun proceedings on the VRT system here in 1998/1999, I believe it was either in 2001 or 2002 (not sure as I can't find the stuff I'm looking for now but will later), aspects of the VRT system here were ruled to be illegal and unfair.
Now our government at the time would not abolish VRT, so instead the EU imposed a set annual fine on Ireland for charging VRT as long as they continued to do so. Now Cossie is correct in saying that the reason why our government are quite happy to continue paying this "set fine" is due to the fact that the amount of the fine is so small compared to that of the revenue generated by VRT.

skyline33 · 15-05-2011 7:14pm

It seems the VRT case is now ready for trial see Business post page 7 dated may 15th May 2011 .

Quote : High court proceedings challenging the VRT regime brought in 1995 by Niall O Dowling of Used Car Importers of Ireland have now been listed for hearing .

hellboy99 · 15-05-2011 7:54pm

skyline33 wrote: »

It seems the VRT case is now ready for trial see Business post page 7 dated may 15th May 2011 .

Quote : High court proceedings challenging the VRT regime brought in 1995 by Niall O Dowling of Used Car Importers of Ireland have now been listed for hearing .

Lets hope something comes of it.

Atomic Pineapple · 15-05-2011 8:41pm

hellboy99 wrote: »

Lets hope something comes of it.

Personally, I hope nothing comes of it, if VRT has to be abolished the government will have to bring in some other tax to make up the shortfall and you can guarantee it will be a lot worse than VRT. (And wont be open for legal challenges)

hellboy99 · 16-05-2011 1:43am

draffodx wrote: »

Personally, I hope nothing comes of it, if VRT has to be abolished the government will have to bring in some other tax to make up the shortfall and you can guarantee it will be a lot worse than VRT. (And wont be open for legal challenges)

The current VRT system does need to be looked at if you ask me, and I'm not just saying that because of recent events. And as for another tax coming in if they got rid of it, sure we have water rates, poll tax and god knows what else coming :rolleyes:

Atomic Pineapple · 16-05-2011 10:08am

hellboy99 wrote: »

The current VRT system does need to be looked at if you ask me, and I'm not just saying that because of recent events. And as for another tax coming in if they got rid of it, sure we have water rates, poll tax and god knows what else coming :rolleyes:

None of which will cover the losses in VRT though and you have to take into account the second hand car market too if VRT is abolished, it will be in disarray with the value of cars plummeting, my car's value would probably be halved straight away.

If that happened how would the government deal with it? Would they have to compensate second hand car owners by returning a % value of the VRT for the cars current OMSP?

hellboy99 · 16-05-2011 10:17am

draffodx wrote: »

my car's value would probably be halved straight away.

If that happened how would the government deal with it? Would they have to compensate second hand car owners by returning a % value of the VRT for the cars current OMSP?

No, they wouldn't have to and that's just stupid to ask, that's like asking for the thousands back lost on the value of your home or looking for your pension fund back lost due to the state of the banks.

Atomic Pineapple · 16-05-2011 10:34am

If its seen to be an illegal practice carried out by the government I'd imagine any outcomes from the trial would have to be retrospectively applied.

Anyway my point was more to do with the thousands of second hand cars sitting on dealers forecourts, they will have bought the cars at current prices which are inflated due to VRT, if VRT is abolished, the value of those cars will fall significantly as buying a new car will make more sense if there's no VRT.

This could make most dealers businesses un-viable in an industry already hit pretty hard by the recession.

VRT, the madness continues!

Comments