VRT: The Irish are treated as second-class EU citizens.

zod

Taken from todays McWilliams article in the Sunday Business Post


"Traipse over to Britain. You find your dream car for, let’s say, £18,000.You bring it back to Ireland. You are then confronted with the first tax - VRT. So already the state is bending the rules.

Resigned, you are then prepared to pay the tax on the euro value of the sterling cost of the car. So the first rule of the Treaty of Rome is broken the minute you get off the boat at Dun Laoghaire, because any tax on any good at the point of entry contravenes the original Treaty of Rome.

But worse is to come. The Revenue then judge that it’s not the cost of the car in Britain that counts for the tax, it is some Orwellian-sounding levy called the ‘‘open market selling price’’. The Revenue, in an approach which protects Irish car dealers, squeeze money out of the beleaguered Irish motorist with another, extra tax.

They calculate the difference between what the car cost in the free, unfettered market of Britain and what it might cost here in the protected, sewn-up kleptocracy that is Ireland and then slap another totally unjustified tax on top of the original totally unjustified tax.

If you want to see how this shameless infringement of EU law works, check out https://www.ros.ie/VRTEnquiryServlet/ showCarCalculator. Rather than enhance competition, our government smothers it. The motorist is being penalised twice to protect Irish car dealers who have being making a fortune in recent years by selling overpriced cars. The state, therefore, is not only breaking the rules of the EU but, more egregiously, is protecting an industry here which is actually doing nothing.

Today we have the ludicrous spectacle of our government urging us to vote Yes to the Lisbon Treaty.

I’m sure there are good enough reasons for this, but how can we trust the government on one European treaty if they are prepared to tear up their obligations on another? They want us to vote Yes to the Lisbon Treaty, even though they ignore the basic founding principles upon which the EU was constructed.

Until the iniquitous VRT scam is scrapped, we should argue that, on the basis of being good Europeans, we can’t vote for the Lisbon Treaty because it is supported by a government that is not European enough."

E92

Yawn....

Anyone tell me what Government is going to get rid of VRT when it brings them in nearly €1.5 billion a year?

And even if they did get rid of it, we'd all have to pay some other way to make up the revenue shortfall.

It suits the SIMI to have VRT, it suits the Government to have VRT, so you can bet your life it's never going to go.

And it's not illegal, the EU doesn't have the power to get rid of it, and now that it is an emissions based tax, they certainly aren't going to get rid of it, because now it is someway environmentally friendly, and thats all the justification the Government needs.

Of course, I'd like as much as the next person if we got rid of VRT and replaced it with an additional tax on fuel(now that would really make environmental sense, but that would be far too clever for our supposedly greener Government), but it ain't gonna happen, and the new VRT system will make many diesel cars and even plenty of petrol cars more affordable, so in my eyes the new system is the start of what will hopefully be the end of VRT.

mick.fr

Has any individual ever tried to challenge the VRT in Ireland?

This tax is very heavy and I don't understand why it has not vanished in several other taxes, like 5% increase here, 5% increase here, at the end of the day, 1.5 billion euro could pretty easily get collected from other sources, isn't?

niceirishfella

E92 wrote: »

Yawn....
And it's not illegal, the EU doesn't have the power to get rid of it, and now that it is an emissions based tax, they certainly aren't going to get rid of it, because now it is someway environmentally friendly, and thats all the justification the Government needs.


emmmmm......wrong.......
VRT is illegal under the Treat of Rome. Go look at it and educate yourselves - but you are right in saying the the gov are never going to get rid of VRT.

mick.fr

EU laws have priority to local laws, this has been the case many times.
Under this consideration, why would you not buy a car abroad, bring it back here, try to register it and challenge the tax office in court?

Technically you could win, isn't?

E92

niceirishfella wrote: »

emmmmm......wrong.......
VRT is illegal under the Treat of Rome. Go look at it and educate yourselves - but you are right in saying the the gov are never going to get rid of VRT.

If it was illegal, the EU would have gotten rid of it for us ages ago.

And the Portugese, Dutch and Danish Governments also have obscene amounts of VRT, and I don't see anyone trying to get rid of it there either. Short of the EU harmonising tax laws(and if we have any sense that will never ever happen), VRT is an inconvenience we'll always have to put up with.

mick.fr

E92 wrote: »

If it was illegal, the EU would have gotten rid of it for us ages ago.

And the Portugese, Dutch and Danish Governments also have obscene amounts of VRT, and I don't see anyone trying to get rid of it there either. Short of the EU harmonising tax laws(and if we have any sense that will never ever happen), VRT is an inconvenience we'll always have to put up with.

The EU already has put pressure on the Irish gov, or simply made en enquiry about it in the past, like they did to other EU country members.
Now each government does what they want most of the time, take the English for example, the least EU country from all.

Other EU countries are now charging extra fees on new cars, but it is a very small portion of the cost of the car. This extra money goes to the ecological "fund", under new pollutions acts in Europe.
In France for example, a SUV will cost an extra 2300 euro to register, we are not talking about 20.000 crazy euro like here in Ireland.

JHMEG

Thing about VRT is it's sort of optional, and up to you to decide how much to pay. Those who don't buy cars don't pay, those how buy Merc S classes pay lots. Some argue it's anti car/anti motorist.

The alternative is a mandatory 5% rise in income tax. Is that anti employment/anti worker? I think I'd prefer VRT.

mick.fr

JHMEG wrote: »

Thing about VRT is it's sort of optional, and up to you to decide how much to pay. Those who don't buy cars don't pay, those how buy Merc S classes pay lots. Some argue it's anti car/anti motorist.

The alternative is a mandatory 5% rise in income tax. Is that anti employment/anti worker? I think I'd prefer VRT.

Yep but Ireland attracts, well used to, not the really the case anymore, foreigners investors, like US and German because of its light tax system on companies and individuals.
So this is still what maintains most of the companies in Ireland, even if more and more even foreign investors are delocalising outside Ireland.

A smoother system would have been nice, instead of having a huge tax in one particular area.
And really it does not matter if now my tax credit is 500 euro a week (Example) if I have to pay 60000 euro for a more or less good spec car as a starting point. At the end of the day I probably end up paying more tax anyway than the average Eu citizen if I drive a nice car in Ireland.

mick.fr

And plus not to forget the money we are saving on wages taxes we pay it pay with the 21% VAT.
So at the end of the day, the Irish tax payers, pays a lot of money to the tax system. Road infrastructure, money to refund to the EU etc..

mildews

Should'nt we all have to thank Charles J. Haughey for the introduction of this ? I bet you he never paid VRT on his Mercs.

Niall1234

E92. Your wrong on your assumptions. By right the Irish Government should scrap VRT.

The same is happening on the Water Rates for schools things. They are under as much obligation under EU rules to have Water Rates on schools. Funnilly enough they are taking no chances here and are slapping the Water Rates on schools.

The faster some group take a case to the some EU court regarding the illegal nature of VRT in Ireland the better.

Guy:Incognito

Niall1234 wrote: »

E92. Your wrong on your assumptions. By right the Irish Government should scrap VRT.

The same is happening on the Water Rates for schools things. They are under as much obligation under EU rules to have Water Rates on schools. Funnilly enough they are taking no chances here and are slapping the Water Rates on schools.

The faster some group take a case to the some EU court regarding the illegal nature of VRT in Ireland the better.

So in all the countries that have VRT covering so many millions of people, not 1 person has decided to take this unloseable (it has to be if its illegal) case against one of the governments? Surely a lawyer would take it on himself and forever be known as the guy who beat VRT and saved us all.

No? didnt think so.

Niall1234

Stekelly wrote: »

So in all the countries that have VRT covering so many millions of people, not 1 person has decided to take this unloseable (it has to be if its illegal) case against one of the governments? Surely a lawyer would take it on himself and forever be known as the guy who beat VRT and saved us all.

No? didnt think so.

I'm not going to answer regarding other countries, but from everything I've read over the years, VRT is technically illegal with EU law and shouldn't be there. It warps the common market and is therefore illegal.

bazz26

Judging by record new cars sales so far this year and record levels of second hand cars being imported it looks like most people are ok with paying it.

Maybe one way of fighting the VRT system is not to contribute to it. Keep your current car until it dies. Not going to happen in reallity though.

shayser

could be well wrong, but is it not the case that the tax is a registration tax, not a tax on a purchase/import? So you can buy from outside the state at whatever price but Irish law states that when you register a foreign car in this country there is small matter of vehicle registration tax.

Tipsy Mac

shayser wrote: »

could be well wrong, but is it not the case that the tax is a registration tax, not a tax on a purchase/import? So you can buy from outside the state at whatever price but Irish law states that when you register a foreign car in this country there is small matter of vehicle registration tax.

If this is the case (which it's not) than why are residents from other countries allowed register the car VRT free if the tax is solely for the provision of the license place.

If us motorists got up off our holes and made it an issue for the Lisbon Treaty and all voted no then we would suddenly find the illegal tax abolished or atleast the EU would take notice.

Guy:Incognito

Tipsy Mac wrote: »

If this is the case (which it's not) than why are residents from other countries allowed register the car VRT free if the tax is solely for the provision of the license place.

If us motorists got up off our holes and made it an issue for the Lisbon Treaty and all voted no then we would suddenly find the illegal tax abolished or atleast the EU would take notice.

Right so, if your right and its illegal, then its an unloseable case. Doesnt need loads of people to fight it, just one to fight and win (it's illegal so you cant lose remember), so you do it. No more moaning and sayign "people should do this or that" , YOU do it.

Let us know how you get on.

Anan1

Tipsy Mac wrote: »

If us motorists got up off our holes and made it an issue for the Lisbon Treaty and all voted no then we would suddenly find the illegal tax abolished or atleast the EU would take notice.

Who exactly are 'us motorists'? I'm a 'motorist', and I don't want VRT removed. Nor do most of my 'motorist' friends. The reason - we're not just motorists.

shayser

Tipsy Mac wrote: »

If this is the case (which it's not) than why are residents from other countries allowed register the car VRT free if the tax is solely for the provision of the license place.

If us motorists got up off our holes and made it an issue for the Lisbon Treaty and all voted no then we would suddenly find the illegal tax abolished or atleast the EU would take notice.

If the Vehicle Registration Tax is not a vehicle registration tax then what is it? I thought I read that the reason that that the EU are powerless to force Ireland to abolish VRT is that the Irish government has made sure that the tax is not an import duty (in reality it obviously is), but a vehicle registration tax.

Tea drinker

Anan1 wrote: »

Who exactly are 'us motorists'? I'm a 'motorist', and I don't want VRT removed. Nor do most of my 'motorist' friends. The reason - we're not just motorists.

Nah, not just a motorist - a stupid motorist! (joking)

Anyway the more you pay for something in Ireland the richer you are.
Same deal with houses.
I don't see why we should support an illegal tax. I also recall the EU objecting to this. Anyway, it will be "taken care of" by morphing into a "Green tax". Any comment Gormley?
It is a good reason to reject Lisbon, I agree, lets funk it up!

Robbo

Using VRT as a reason to reject the Lisbon Treaty? Are the Irish voting public on some kind of wilful mission to prove how unsophisticated and easily sidetracked they are?

The standing of VRT in relation to European law has come up before on Legal Discussion. Harping on about Article 25 like it's some kind of absolute is madness, there are numerous allowable exceptions to it (proportionality, public health etc). It has been argued that whilst VRT isn't within the spirit of A.25, it is broadly inline with EU objectives (the environment). The move to a carbon based system will copperfasten this.

Anyone still convinced of the perceived "Illegality" of VRT is perfectly welcome to take a case to the European court if they have the stones and money to do so. Just be aware that if it is abolished, that €1.5 billion is going to have to come from somewhere else...

Guy:Incognito

Tea drinker wrote: »

Nah, not just a motorist - a stupid motorist! (joking)

Anyway the more you pay for something in Ireland the richer you are.
Same deal with houses.
I don't see why we should support an illegal tax. I also recall the EU objecting to this. Anyway, it will be "taken care of" by morphing into a "Green tax". Any comment Gormley?
It is a good reason to reject Lisbon, I agree, lets funk it up!

I'm sure the EU object to lots of hings, but just as in this case, it doesnt make it illegal.

JHMEG

Those of you on this thread who are anti-VRT: where do you propose the €1.5 billion come from if VRT was abolished?

mick.fr

JHMEG wrote: »

Those of you on this thread who are anti-VRT: where do you propose the €1.5 billion come from if VRT was abolished?

Well while some guys are talking about VRT being an pollution's tax, why not taxing the planes fuel.
Funck up the Chicago Agreement in 1947, this is useless nowadays.

Airplane company pay 0 taxes on fuel.

Let's start with 5 cents a liter, don't worry in 12 months the Irish gov will make 5 billion (To be calculated precisely though)

And don't tell us airplanes don't pollute and that only motorists do!
That would be more responsible for the environment cause all the polluters will be paying.

shayser

JHMEG wrote: »

Those of you on this thread who are anti-VRT: where do you propose the €1.5 billion come from if VRT was abolished?

A "registration tax" on shoes, or sat navs, or babies bottles, or bananas. If it's good enough for cars it's good enough for anything else. What the difference?

JHMEG

Introduce tax on aviation fuel and they just buy it in another country.

Litter, I see your point, but the cost of enforcement would be more than €5 with all the extra civil servants.

How about a real suggestion?

JHMEG

Tax on bananas?

Is no-one actually able to come up with a practical way to find the €1.5 billion to replace VRT?

mikemac

shayser wrote: »

A "registration tax" on shoes, or sat navs, or babies bottles, or bananas. If it's good enough for cars it's good enough for anything else. What the difference?

Because a car is a luxury good

mick.fr

JHMEG wrote: »

Tax on bananas?

Is no-one actually able to come up with a practical way to find the €1.5 billion to replace VRT?

I just gave a very valid point, get down on your feet, this has already be discussed by several EU countries. This agreement has been put in place in 1947 to encourage the development of civil aviation. A bit obsolete today don't you think?
And of course no you don't buy millions of fuel outside the official country channels. This is controlled by customs.

mick.fr

JHMEG wrote: »

Tax on bananas?

Is no-one actually able to come up with a practical way to find the €1.5 billion to replace VRT?

There are lots of possibilities, certainly not bananas.
Increase taxes on petrol, decrease tax credit, increase VAT, increase companies tax, etc...
But Ireland relies 100% on foreign investments so if you do touch companies current tax system, this is back to the 70 for Ireland :-) and half of the country will fly out again.

trellheim

that 1.5 billion could be recouped easily by quadrupling or [whatever] the excise on fuel. You then have a proper "polluter pays" rather than a flat rate

e.g. I have a Lexus LS400 and drive < 4000 miles a year.

Joe Soap who drives 40000 miles a year in an LS400 pays the same VRT

but I pollute less.

shayser

Sat Navs, TVs, DVDs, Cameras. Footballs. Ice Cream. Why not just reintroduce import duty for everything. Works great with cars.

JHMEG

Quadruple the excise on fuel and within a year the country will be running on biodiesel, and you can't tax that too heavily as the greens are in govt...

Taxing aviation fuel would kill competition. No more cheap flights.. they'd all be expensive. I'm old enough to remember an average return flight to London with Aer Lingus costing £400, and the only alternative was "the boat".

Niall1234

Road tax for bicycles.

They essentially use the road for free.

JHMEG

mick.fr wrote: »

But Ireland relies 100% on foreign investments

The tax you're on about is corporation tax, not income tax. Corporation tax is 12.5% currently, and it attracts foreign industry. Right or wrong, it works.

OTOH, the French unemployment rate almost equals our corporation tax rate. I know which I'd prefer.

mick.fr

Yeah pointless thread anyway.
Do we really have the choice?

Anyway as I said like 2 months ago, I know a legal way that any individual living in Ireland can drive a brand new car without paying any tax and for a lot less than any system available in Ireland. Nobody ever sent me a PM to know more, so...

EU has some advantages :-)

mick.fr

Yeah pointless thread anyway.
Do we really have the choice?
Anyway as I said like 2 months ago, I know a legal way that any individual living in Ireland can drive a brand new car without paying any tax and for a lot less than any system available in Ireland. Nobody ever sent me a PM to know more, so...

EU has some advantages :-)

Niall1234

JHMEG wrote: »

The tax you're on about is corporation tax, not income tax. Corporation tax is 12.5% currently, and it attracts foreign industry. Right or wrong, it works.

OTOH, the French unemployment rate almost equals our corporation tax rate. I know which I'd prefer.

Coporation tax is a bit of an enigma. In the end, all money taken out of a company will have to be taxed under Schedule E or Case III Income Tax or in the case of a liquidation under CGT.

Corporation Tax is essentially a tax on retaining money within a company. It is at its heart, a disinsentive to hold cash in companies along with various "Close Company Provisions" for small companies.

mick.fr

JHMEG wrote: »

The tax you're on about is corporation tax, not income tax. Corporation tax is 12.5% currently, and it attracts foreign industry. Right or wrong, it works.

OTOH, the French unemployment rate almost equals our corporation tax rate. I know which I'd prefer.

Compare what is comparable.
Corp tax in France is over 33% and taxes on wages about 40% on high wages that are probably considered low or average in Ireland.
Give France a 12.5% on Corp. taxes and less wages taxes and it will fly.
But we are far to be here:-)

Noelie

mick.fr wrote: »

There are lots of possibilities, certainly not bananas.
Increase taxes on petrol, decrease tax credit, increase VAT, increase companies tax, etc...

Are you crazy, do you want everyone in the country to pay more tax and higher vat just so the rich can drive cheaper cars?

If VRT is removed it can only go on two things Petrol or Motor tax (obviously the yearly one) Petrol would go through the roof and would also encourage smuggling up north.

However i do feel it should not be added to safety features or to extras on the base cost of the car. The way it is not is kind of the fairest way the tax can be implemented, Small low polluting cars are taxed less and large high polluting cars are taxed more.

JHMEG

Niall1234 wrote: »

Coporation tax is a bit of an enigma. In the end, all money taken out of a company will have to be taxed under Schedule E or Case III Income Tax or in the case of a liquidation under CGT.

Corporation Tax is essentially a tax on retaining money within a company. It is at its heart, a disinsentive to hold cash in companies along with various "Close Company Provisions" for small companies.

What has any of that got to do with this thread, or VRT?

mick.fr

Noelie wrote: »

Are you crazy, do you want everyone in the country to pay more tax and higher vat just so the rich can drive cheaper cars?

Sound like a good plan to me lol

My point is that better spread tax will be easier for everybody.
Just some increases here and here will benefit to every one instead of having to pay crazy money to buy a new car.

E92

Any political party that tries to increase personal taxes gets nowhere in this country.

It is never going to happen.

Back on topic, the easiest solution to VRT is a tax on fuel. That way you pay for your pollution(which you only sort of under the new VRT system).

Given the amount of people importing, and the amount of people buying new cars, the are never going to even so much as think of reducing VRT, and rightly so. As long as we're stupid enough to buy new cars in the numbers we do, the Government certainly aren't going to touch it.

And in the interests of the planet, new cars most certainly should be taxed to reflect the fact that there is so much pollution involved in making new cars(it shouldn't be anything like as high as at the moment, but there should be a blanket tax of say 10%), and road tax rates should be standardised. A 5.0 V8 sitting in a driveway isn't doing any more damage than a 1.0 3 pot is, so a bit of reality is needed here.

JHMEG

E92 wrote: »

A 5.0 V8 sitting in a driveway isn't doing any more damage than a 1.0 3 pot is, so a bit of reality is needed here.

Probably 3 times more metal, including lots of aluminium, went into the 5 litre.

mikemac

Niall1234 wrote: »

Road tax for bicycles.

They essentially use the road for free.

Good point but seeing as there is no such thing as "road tax" then motorists don't pay road tax either.
Or did you mean motor tax?

Seth Brundle

JHMEG wrote: »

Probably 3 times more metal, including lots of aluminium, went into the 5 litre.

The government don't give a toss about its production (because the carbon usage doesn't affect the Irish total). They are only concerned about its purchase and its use.

macplaxton

Fundamental problems with VRT:

a) It hampers free movement of goods around the EU.
b) It taxes the ownership of the car and not the use.

The UK doesn't have a VRT, but it does have petrol at €1.40+ a litre. Take your pick.

JHMEG

kbannon wrote: »

The government don't give a toss about its production (because the carbon usage doesn't affect the Irish total). They are only concerned about its purchase and its use.

Pointing out to E92 that his 10% argument doesn't allow for the fact that bigger cars cost more, generally.

Nothing to do with this country.

Seth Brundle

macplaxton wrote: »

Fundamental problems with VRT:

a) It hampers free movement of goods around the EU.
b) It taxes the ownership of the car and not the use.

The UK doesn't have a VRT, but it does have petrol at €1.40+ a litre. Take your pick.

The UK does have a registration fee (a rose by any other name...)
http://www.direct.gov.uk/en/Motoring/BuyingAndSellingAVehicle/RegisteringAVehicle/DG_4022317
However, as with most countries in the EU, it is very little.

Padraig Mor

Noelie wrote: »

Are you crazy, do you want everyone in the country to pay more tax and higher vat just so the rich can drive cheaper cars?.

That's a bit arseways isn't it? At the moment motorists (especially those who buy new cars) are subsidising non-motorists through their extra contribution to general taxation. Why should someone who buys a new car be required to throw thousands into the health black hole for no other reason than they bought a car? Because they're "rich"? (surely they'll have private health insurance then?!). And is someone who buys a new Yaris "rich"? Where is the defining line for "rich"?