CUSTOMS DUTY ARTICLE 28 TFEU/ OR ARTICLE 110

Dylan123

QUICK QUESTION:

- Is vehicle registration taxation (VRT) a customs duty (Art 28 TFEU) or discriminatory taxation (110 TFEU) or neither.........

- Can anyone tell me why its not a restriction to the free movement of goods or a measure having equivalent effect.

Is it because when a person purchases a new car, the vrt is the same??? i have never bought a new car so i would not know....

MagicSean

It's not a tax on the movement of goods. You can buy a car in the EU and bring it here with no charge. It is a tax on using that vehicle on the road. All cars must pay this charge to be used on Irish roads. It is actually still cheaper to import and VRT a car to Ireland so this may be one of the things that saves it.

Dylan123

So if its a tax for use on the road (NOT STRICTLY SPEAKING ROAD TAX) - is this a discriminatory taxation, as its not (in)directly applied to the purchase price of other second hand vehicles in this country?

Or is it that - vat should be charged on the purchase of every second hand motor vehicle. (which we know is not the case in practice)

I cant see how this tax is the same for domestic 2nd hand cars - and see it simply as a method of indirect discrimination in favor of the Irish revenue.

FreudianSlippers

Dylan123 wrote: »

Perhaps i am wrong here! But vrt.ie website would disagree with what you have said - or else i am misinterpreting this.

"Vehicle Registration Tax is chargeable on registration of a motor vehicle in the State. All motor vehicles in the State, other than those brought in temporarily by visitors, must be registered with the Revenue Commissioners. A vehicle must be registered before it can be licensed for road tax purposes."

Registration is different to taxation

The answer is in your question: it is a registration tax.

Dylan123

So if it is a registration tax - would that suggests it is indirect discrimination under art 110 TFEU, ex (Ex art 90EC) Because:

(1) If i purchase your Aston Martin today in Ireland - i would not be required to pay a registration fee.
However:
(2) If i purchased an Aston Martin in London today, and bring it home to Ireland, i would be subject to this fee.

-Commission v Ireland (buy Irish)
-Casis (hits imports in favor of domestic products)
-Dassonville (impacts inter-community trade)
-John walker principle (objective test)

FreudianSlippers

Dylan123 wrote: »

So if it is a registration tax - would that suggests it is indirect discrimination under art 110 TFEU, ex (Ex art 90EC) Because:

(1) If i purchase your Aston Martin today in Ireland - i would not be required to pay a registration fee.
However:
(2) If i purchased an Aston martin in London today, and bring it home to Ireland, i would be subject to this fee.

-Commission v Ireland (buy Irish)
-Casis (hits imports in favor of domestic products)
-Dassonville (impacts inter-community trade)
-John walker principle (All spring to mind)

You pay VRT on any car to be registered in the state, whether or not it is purchased in Ireland.

MagicSean

Dylan123 wrote: »

So if it is a registration tax - would that suggests it is indirect discrimination under art 110 TFEU, ex (Ex art 90EC) Because:

(1) If i purchase your Aston Martin today in Ireland - i would not be required to pay a registration fee.
However:
(2) If i purchased an Aston Martin in London today, and bring it home to Ireland, i would be subject to this fee.

-Commission v Ireland (buy Irish)
-Casis (hits imports in favor of domestic products)
-Dassonville (impacts inter-community trade)
-John walker principle (objective test)

If you purchase it in Ireland the price is generally inclusive of the VRT.

Dylan123

The vehicle registration tax would have already been paid in the UK when it was first imported/ sold/ registered.
So why would it have to be paid twice on a second hand vehicle?
- This is still looking like it is a method of indirect discrimination because:
(1) It favors the purchase of second hand vehicles in Ireland opposed to honoring the directly affective and applicable Article 110 TFEU (Ex art 90 TEC)

MagicSean

Dylan123 wrote: »

I get it now many thanks!

But!!!!
- That vehicle registration tax would have already been paid in the UK when it was first imported/ sold/ registered? So why would it have to be paid twice on a second hand vehicle.
- Its clear with new vehicles

I don't think they have a VRT in England. If they did it would cover registration of the vehicle for use on English roads. The VRT in Ireland is to register the vehicle for use on Irish roads. It is only ever paid once on every vehicle.

EDIT: When I did comapny law I got fired up about this. Spent months writing to different departments and competition authorities. Nobody wants to touch the tax.

FreudianSlippers

I'm not entirely sure about this, but I don't think they have a VRT in the UK

EDIT: missed k_mac's post, but looks like we're on the same page.

Dylan123

In an exam type condition such as that of the fe1's.

Would it be argued that the Doctrine of direct effect could/ would be used - and the Criteria that was set out in Van Gend En loose case would apply:
(1) Art 110 (Ex Art 90 TEC)- Must be clear and precise
(2) Unconditional
(3) Confer a specific right

Could the revenue objectively justify this taxation on the basis that the tax is for a car on an Irish road, when and where there is already another specific road tax and the car has already been registered in another Eu country whether or not they have a fee?

slimjimmc

FreudianSlippers wrote: »

I'm not entirely sure about this, but I don't think they have a VRT in the UK

EDIT: missed k_mac's post, but looks like we're on the same page.

They do but it's a flat fee of £55.
link

CantGetNoSleep

There is a case from the ECJ about vrt in Denmark, think it is Commission v Denmark, read it and you should figure out why vrt is still legal here

But in the Danish case it was illegal

Del2005

Dylan123 wrote: »

Could the revenue objectively justify this taxation on the basis that the tax is for a car on an Irish road, when and where there is already another specific road tax and the car has already been registered in another Eu country whether or not they have a fee?

The law states that an Irish resident can't drive a foreign registered vehicle on Irish roads. VRT is a tax to register a vehicle to be allowed to drive on Irish roads. Then you pay a tax to drive actually drive on the road.

VRT has been taken to the EU courts and been found legal. And even if they do rule against it they'd just change the name, as they did when the single European market came in 1993, it used to be called Excise duty.

Dylan123

slimjimmc wrote: »

They do but it's a flat fee of £55.
link

Thanks for your responses. Just interesting from an educational point of view.

Seems difficult to ascertain how an objective defence, can have a reasonable justification in this situation.