Article: Car dealers seek refund of €170m on SUV taxes

Seth Brundle

from here...

By Treacy Hogan and Eddie Cunningham
Wednesday March 05 2008

There is a fear within the industry that if dealers succeed, it could mean motorists will have to make up the difference

DOZENS of motor dealers are looking for up to €170m back from the taxman in Vehicle Registration Tax (VRT).

The dealers have made a compensation claim against the Revenue Commissioners for alleged tax overpayment on 4x4 SUVs for the past 15 years.

The Irish Independent has learned that the claim formally lodged by motor dealers with the Revenue could reach €170m if successful.

The car dealers are represented by leading accountancy firm Deloitte. They are claiming sports utility vehicles were classified as "off-road vehicles" and should have attracted no vehicle registration tax, similar to tractors.

They want the money back-paid to cover the period from 1992 to 2007, when the legislation was changed to close off any possible confusion.

Frank Daly, the chairman of the Revenue Commissioners, has insisted that the vehicles would not have been entitled to be on the public road in the first place if they had not been registered.

SIMI, representing motor dealers, is not party to the claim.

Sources said last night the Revenue Commissioners have written to Deloitte seeking additional information before they can rule on the claim.

SUVS, once the preserve of construction and agricultural workers, have become increasingly popular among urban dwellers as family "run-arounds".

They have also been branded gas-guzzlers, and many will be in the top bracket for VRT and motor tax when the new emissions-based regime starts this summer.

It is understood that the argument for getting the massive repayment of VRT is based on a small loophole that exists in the current system.

However, there is a widespread fear within the motor industry that if the dealers in this instance succeed -- even to a limited extent -- it could mean motorists and taxpayers will have to make up the difference and changes implemented could have long-term knock-on effects.

VRT has long been a bone of contention and several attempts have been made to challenge it. However, this is understood to be the first of its kind.

The move was confirmed last night by Deloitte.

See Motoring: 52/53

- Treacy Hogan and Eddie Cunningham

Wossack

SUV =/= off road vehicle

(in the majority of cases)

if this is sucessful, will these dealers be passing on these VRT refunds to the buyers of said SUV's?

Seth Brundle

Just re-reading it, the dealers claim that they paid too much VRT because 'off roaders' should be classified like a tractor and therefore no VRT.
However, the buyer would have paid the VRT amount to the dealer so are the dealers taking on this case on behalf of all SUV buyers? Will the dealers pay the compensated amount (if any) back to the buyers?

edit: wossack seems to have made the same point!

-Chris-

I wouldn't even see this as worthy of debate - there's nobody in their right mind who thinks that this could ever possibly work.

+1 on the passing it on to consumers too - I'd say any dealership successful in receiving a refund would instantly be sued by their customers to get the VRT back - dealers don't pay VRT or VAT, they merely collect if from the customer and pass it on to the Revenue.

kodute

This is a tough decision... Does my dislike of VRT exceed my dislike of SUVs being used as "family run-arounds"? hmmm...


-1 for money back to consumers. Bad purchasing decisions should not be rewarded.

astraboy

While I don't agree with why they are doing this, I just love to see people stick it to the Revenue/Government over VRT! In fairness though, most of these "off road vehicles" have never been in a muddy field, not to mind proper off roading.

I think classing an X5 as an off road vehicle is a stretch too far, they are known not to be very good off road. If your on about a land rover defender used 50% of the time by the owner off the road, fair enough, VRT should be reduced or at 0. If its simply used as a car, VRT should be payed in full. The problem is getting people to prove they use the car on/off road. Most people buying these for work buy commercial versions anyway, with only 75E VRT I think, so its not really an issue.

unkel

Not so good for the reputation of Deloitte :rolleyes:

astraboy

unkel wrote: »

Not so good for the reputation of Deloitte :rolleyes:

Would'nt say so. They are a consultancy, they do work for the highest bidder. If they won a victory against VRT it would raise their profile further.