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Will Ireland push the EU to scrap VAT on car imports from the UK

  • 28-01-2023 9:52pm
    #1
    Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    As the title says, we don't have a big enough population to have a properly functional car market. If the status quo stays as it is the average age of Irish cars will skyrocket as we don't buy enough new cars to have a functional used car market due to our population size.

    Seeing as we can't import from any other EU country because they are LH drive I think in the next 2 years we will see the government seek a special deal for cars.



«1

Comments

  • Registered Users, Registered Users 2 Posts: 6,339 ✭✭✭alias no.9


    Any change to VAT rules on UK imports will be tied to any general trade agreements between the EU and UK, you're kidding yourself if you think there will be some kind of sweetheart deal for second hand cars.



  • Registered Users, Registered Users 2 Posts: 2,288 ✭✭✭Miscreant


    And forego all those sweet, sweet VAT monies? I doubt it.

    The current situation is likely pushing people into buying new cars due to the second hand market being depressed. Win, win for the government.



  • Registered Users, Registered Users 2 Posts: 6,339 ✭✭✭alias no.9


    Oh and just FYI, there are two other EU countries that drive on the left, typically in RHD cars



  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    The car market here is doing fine. Prices have just increased like everywhere else in the world. And it should get a bit better when new cars become more available. The government have no reason to change VAT rules.

    As far as I know no other products have special VAT rules. Customs duty yes, but not VAT.

    A reduction from 10% to 5% customs duty could be possible similar to the EU Japan trade deal, but that wouldn’t make much difference



  • Registered Users, Registered Users 2 Posts: 69,548 ✭✭✭✭L1011


    No. The state has no reason to care about the second hand market

    Also, the UKs self inflicted recession will cut off supply of nearly new cars from there anyway



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  • Registered Users Posts: 1,812 ✭✭✭Eoinbmw


    Car market is not doing fine 90k for a golf r here?

    Place is gone to the dogs!



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    Doing fine is it 😂 it's way out of it whack with other countries even taking into account the pandemic.

    knew Malta have RH drive cars didn't know about Cyprus, both tiny countries so makes no difference to us.



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    It clearly does when they don't want the average car age in the country to be 20 years old and they have to fit that in with EU emissions and safety laws regarding cars



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    ..



  • Moderators, Recreation & Hobbies Moderators, Science, Health & Environment Moderators, Technology & Internet Moderators Posts: 92,480 Mod ✭✭✭✭Capt'n Midnight


    The rules on cars sold from the UK depend on where they were originally made. EU imports into the UK which are then ere-xported, even years later don't benefit from the trade deals. It's just the ones built in the UK according to the rules of origin.


    UK car production collapses to lowest for 66 years - They still had coal rationing back then

    Brexit deal means from 2024 batteries not containing 50% local materials face EU tariffs and their battery factory went bust last week.

    Brexit is just a slow motion car crash

    We can still get cars from Japan.



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  • Registered Users, Registered Users 2 Posts: 69,548 ✭✭✭✭L1011


    The states interest is entirely in reducing the total number of cars. Nothing else.

    There is zero reason to even consider rule changes, so don't imagine it might happen



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    I know, tiny countries so irrelevant to this discussion. In an even worse situation than us regarding this.



  • Registered Users, Registered Users 2 Posts: 6,339 ✭✭✭alias no.9


    On an EU scale, we're tiny too and certainly not special



  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    But thats nothing to do with Brexit or EU VAT rules?

    Cars have always been overpriced here due to VRT



  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    Thats nothing to do with what was outlined in the post tho. Cars have always been overpriced here due to VRT.

    The 90k Golf is due to manufacturer price increases and VRT, not EU VAT rules



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    It's not all to do with VRT. Cars were always expensive here but they are piss take prices now for used cars and thats never going to change because we don't have a functioning market so even when used prices level off throughout the world when production gets back in sync they never will again here.



  • Registered Users, Registered Users 2 Posts: 11,224 ✭✭✭✭Jim_Hodge


    Not a snowballs chance in hell.



  • Registered Users, Registered Users 2 Posts: 1,271 ✭✭✭Packrat


    I wonder if the current situation will lead to more people buying LHD cars from other countries and using them here..

    Probably never be a huge number due to increased insurance etc but stranger things have happened.

    “The Party told you to reject the evidence of your eyes and ears. It was their final, most essential command”



  • Registered Users, Registered Users 2 Posts: 5,814 ✭✭✭creedp


    We are lucky that the car market is transitioning to EV as at least the Govt is currently subsidising the purchase of new EVs which should help a little to increase the used car supply down the road.



  • Registered Users, Registered Users 2 Posts: 24,357 ✭✭✭✭Larbre34


    If it starts happening en masse, they'll be refused insurance altogether. So no.



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  • Registered Users, Registered Users 2 Posts: 24,357 ✭✭✭✭Larbre34


    The car market is going through a periodical reset, thats all.

    We've got 5.2 million people, we can easily sustain 250,000 new and used sales, if the value is there for people.

    Good dealers are working to secure the stock and that good value, that's what they do. The bad ones are disappearing and thats no harm either.

    The best thing the government can do, is GTF out of the way.



  • Registered Users, Registered Users 2 Posts: 5,656 ✭✭✭CalamariFritti


    Don't see it. a) they almost certainly would come under lobby fire from the local car trade. b) at least while the greens are in co-power they won't want to make cars cheaper full-stop and c) why would they want to seek a difficult trade exemption thats isn't really going to benefit the state coffers?

    Can't see it happening.

    People are importing from Japan now. Apparently it's not that difficult, my local garage seems to be doing it all the time.



  • Registered Users, Registered Users 2 Posts: 15,582 ✭✭✭✭elperello


    There was another thread about a week ago discussing the possibility of a VRT reduction on EVs and hybrids.

    Could be a way to get an EV second hand market going.



  • Moderators, Business & Finance Moderators Posts: 10,420 Mod ✭✭✭✭Jim2007


    No because it is not possible. As members of the WTO they must comply with a concept called “most favored national”, which means in simple terms that you can’t give a better deal to the UK than to any other WTO member. On top of this the trade agreements with Japan and Canada require their approval if you want to give a better deal to the UK. So the bottom line is that you keep importing tariffs on all or you scrap them on all, no exceptions.

    You are more likely to see Ireland switching to the other side of the road before tariffs will be dropped.



  • Posts: 0 Arlo Brave Suit


    It’s not just unlikely. It’s effectively impossible. Brexit has taken the UK not only out of the EU, but of all the broader associate memberships that many other non-EU countries have been part of, including the Customs Union some aspects of which even extend to countries like Turkey.

    It also will potentially become easier to import RHD Japanese cars because of the EU-Japan trade agreement, which is implementing in phases.

    The EU will have zero interest in complicated arrangements to facilitate one member state buying second hand cars from outside the single market and the customs union or any EU trade deal networks. It makes no sense and would undermine the very concept of the Union. They’ve already bent over backwards to try to facilitate Northern Ireland and have mostly been slapped in the face by the DUP and the Tories with all offers having been thrown back at them.

    Also from the Irish exchequer’s point of view it’s a loss of revenue.

    It’s also not really in the European car industry’s interest to have consumers in what is a pretty wealthy EU member state buying used cars form outside the EU. So I can’t see that lobby working overtime to get exemptions for it either.

    I think a lot of people in the UK are forgetting that the EU’s raison d'être is to encourage trade with and between its members, not to facilitate the whims of 3rd countries. The whole philosophy of striving towards easy, barrier free, low cost trade and a level playing field only applies within the EU itself. There seems to be a lot of surprise that this doesn’t seem to include a former member that’s cut all ties and whose current government seems to imagine it should be able to position it as a giant off shore tax and regulatory haven ‘Singapore on Thames’ and so on, and be somehow granted privileged access to the EU market based on …

    So basically, no - it makes no sense technically or fiscally and it makes no sense politically.

    If people are that hot and bothered about car prices here, they need to start questioning the Irish political parties about VRT and domestic taxes and charges on new cars.



  • Registered Users, Registered Users 2 Posts: 4,544 ✭✭✭goochy


    I think current situation is good . Previous situation where all the UK imports were distorting price of Irish cars



  • Registered Users, Registered Users 2 Posts: 15,582 ✭✭✭✭elperello


    As you say VRT can be adjusted.

    VRT is an Irish Government competency and can be changed without upsetting the EU.

    Post edited by Boards.ie: Mike on


  • Posts: 0 Arlo Brave Suit


    Of course Irish rates of tax on new cars can be adjusted and were for EVs.



  • Registered Users, Registered Users 2 Posts: 15,582 ✭✭✭✭elperello


    So if the policy is to encourage the use of EVs why not reduce VRT on them to make it cheaper to bring them in from UK ?

    I don't know the state of the EV market in UK though.



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  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    VRT has already been reduced on them. And theres also VRT grants for EV’s.

    VRT on a high performance EV for example is still only 7%, compared to 40% on a high performance petrol car



  • Registered Users, Registered Users 2 Posts: 20,110 ✭✭✭✭cnocbui


    The government don't want you driving a Golf R or a Honda Type R, so these prices are achieving their aim. On friday, I couldn't believe my eyes when I spotted a newish Civic Type R. Of course it had UK plates.



  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    At the end of the day there are still thousands of cars to choose from at any point in time and there is no ‘crisis’ as to speak whereby people can’t buy cars. There have been price increases and supply constraints just like everywhere else in the world and the market is already beginning to re adjust slightly from that but we will never get back to pre brexit level of choice supply and price.



  • Registered Users, Registered Users 2 Posts: 11,392 ✭✭✭✭Furze99


    The government can change VAT rates as they wish. They like to hid behind the pretence that the EU ties their hands but that's demonstrably not true. Just recently we see VAT taken off Covid test kits, then VAT restored, then rescinded again. Newspapers rated at 0%, down from 9% in last budget and so on.



  • Registered Users, Registered Users 2 Posts: 688 ✭✭✭kaahooters


    like youd be getting the car transfered over anyway.



  • Registered Users, Registered Users 2 Posts: 3,788 ✭✭✭Neilw




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  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    This article is more recent. It seems only VAT registered traders can avail of the scheme, and personal imports are exempt. But it will still help with supply and should lower prices here




  • Moderators, Business & Finance Moderators Posts: 10,420 Mod ✭✭✭✭Jim2007


    Except that the regulation of the vehicle market does not fall into the category of a national interest, healthcare and the freedom of access to information do, which means other members with car manufacturing in their state will object to such moves.



  • Registered Users, Registered Users 2 Posts: 1,189 ✭✭✭reubenreuben


    They should do something because ireland will run out of certain cars or cars will just keep increasing in value and we will all be driving ancient cars which isn't good for the environment.

    When you change a policy or rule there's always something that is affected negatively.



  • Posts: 4,186 ✭✭✭ Jabari Clumsy Thumbscrew


    Did you read that before you posted it.. according to that they get 1/6th of a VAT back, reading it. What good is that when a car seller who can actually claim that back gets 1/6 vat on a 20 grand VAT bill



  • Registered Users Posts: 175 ✭✭Arnout


    No, it's 1/6th of the purchase price, representing the VAT part.

    Since the VAT rate in the UK is 20%, a claim can be made for 20/120th or 1/6th of the purchase price, so when a car has a purchase price of £ 12,000, an amount of £ 2,000 VAT is included and that £ 2,000 is what can be reclaimed.



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  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    Of course I read it. What are you talking about?



  • Moderators, Recreation & Hobbies Moderators, Science, Health & Environment Moderators, Technology & Internet Moderators Posts: 92,480 Mod ✭✭✭✭Capt'n Midnight


    AFAIK EU regulations mean manufacturers must offer right hand drive vehicles.

    The other thing is that internal combustion is being replaced by Electric Vehicles so some people won't do a lot of work for a permanent fix to a temporary problem.



  • Registered Users, Registered Users 2 Posts: 6,877 ✭✭✭zg3409


    Used prices in NI are higher for many cars than ROI so even with no import taxes it won't be a simple fix to the problem. In the past we took in diesels the UK public did not want.

    I expect some sort of a deal to be Ironed out between EU and UK. The UK manufactures a relatively high amount of cars along with EU so there is vested interest on both sides.

    Prices may have peaked as supply is being restored, except in the EV area where the demand is higher than supply and manufacturers are only making higher end models due to battery and car electronics shortages as they are limited in the number of cars they can make, so they are making the more expensive models.



  • Registered Users, Registered Users 2 Posts: 761 ✭✭✭GSBellew


    There is not a chance in hell that there will be a derogation of VAT on the entry of used vehicles to the EU, that'd open a VAT free route into the EU market for any used car over 6 months old / 6,000 km



  • Registered Users, Registered Users 2 Posts: 5,814 ✭✭✭creedp


    Agree it's not going to happen as Brexit has been a godsend for Irish dealers especially as we can't import from any other EU market.

    As a matter of interest though where would all these used cars come from?



  • Registered Users, Registered Users 2 Posts: 23,462 ✭✭✭✭mickdw


    Once supply in UK is back to normal levels, we will get value here again. The vat is not so much of an issue for traders bringing in cars once they can get vat qualifying cars.

    Duty will be payable in many cases but that's not huge.

    Supply of new cars here and UK is the biggest issue imo.



  • Registered Users, Registered Users 2 Posts: 5,814 ✭✭✭creedp


    Was talking to a dealer during the week and he said they are still bringing in UK cars, half his used car stock are UK imports. He's happy enough as Brexit has meant private importing has all but dried up so much more demand for his UK cars



  • Registered Users, Registered Users 2 Posts: 6,987 ✭✭✭User1998


    Nonsense. Its been far from a godsend. Plenty of dealers gone out of business because of it.



  • Registered Users, Registered Users 2 Posts: 5,814 ✭✭✭creedp


    Some dealers have lost the plot with pricing, Those who haven't will be fine



  • Registered Users, Registered Users 2 Posts: 1,189 ✭✭✭reubenreuben




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