Olivia Mitchell (Dublin South, Fine Gael)
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Question 519: To ask the Minister for Finance the measures in place to detect foreign cars who fail to pay vehicle registration tax; if the current system has been reformed since 2002; if there are plans to introduce reforms; and if he will make a statement on the matter. [1035/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am advised by the Revenue Commissioners that their officers, who are based at numerous locations around the country, carry out regular and ongoing checks to identify and deal with breaches of VRT Regulations as regards the use of foreign registered vehicles in the State, particularly in relation to the permanent retention of such vehicles in the State or their acquisition by State residents. In addition, co-ordinated national enforcement campaigns are periodically carried out to detect infringements in this area.

The following table provides information regarding the level of enforcement activity since 1998 to date and includes the level of enforcement action arising from the detections. It is worth noting the significant increase in the number of vehicles challenged during 2006 compared to recent years, reflecting the efforts being made to tackle abuse in this area.

As a general rule, all vehicles imported permanently into the State must be registered for VRT purposes. However, section 135 of the Finance Act, 1992, and Regulations made thereunder, provide for a range of circumstances in which foreign-registered vehicles, brought temporarily into the State, are exempted from the registration requirement. Foreign residents working here temporarily are permitted to use foreign-registered vehicles in the State, normally for a period not exceeding 12 months, as are foreign students. The exemption also extends to include vehicles brought into the State by tourists, or by other non-residents who are in the State on a casual basis, e.g. Northern Ireland residents on shopping trips. The use of foreign-registered company and commercial vehicles by State residents is also permitted in certain circumstances.

These provisions are required to be in conformity with Article 39 of the EU Treaty, which provides for the free movement of EU workers between Member States, and a reciprocal arrangement also applies to Irish residents who bring their cars temporarily to other Member States.

While the current Regulations have been in place since 1993, there have been some recent changes in the scope of the exemption, as regards the use of vehicles provided by employers, arising from decisions of the European Court.