Oireachtas Joint and Select Committees

Thursday, 7 March 2013

Committee on Finance, Public Expenditure and Reform: Select Sub-Committee on Finance

Finance Bill 2013: Committee Stage (Resumed)

12:00 pm

Photo of Pearse DohertyPearse Doherty (Donegal South West, Sinn Fein) | Oireachtas source

I wish to expand on a point raised by Deputy Michael McGrath. I have raised the issue numerous times. While I have a problem with the way in which VRT is structured we will park it, but the Minister needs to do something for family cars. I do not drive a seven-seater car but my wife does. She has to as it would be illegal for her not to do so. Whenever we have the children with us we have to use the seven-seater car because our oldest child is only seven years and our youngest child is ten months, and we have four. We have to purchase a new or a second-hand seven-seater car. Old cars are affected this year if one buys across the Border. A couple who decides to have a fourth child has to pay more for their car. If they did not have a fourth child they would purchase a five-seater car. There is an additional cost of which we need to be conscious. However it is the couple's choice to have a larger family. This is where VRT kicks in. There is also an issue in terms of motor tax as it penalises those with a seven-seater car because it is structured on CO2 emissions.

It is clear the motor industry has become environmentally efficient. Therefore, more than 80% of cars bought in Ireland fall into categories A and B. However, seven-seater cars do not fall into those categories. A new Ford Galaxy has a CO2 output of 180 g/km. This is the third highest band in VRT. If one is buying a new Ford Galaxy it will fall into the 30% range for VRT which means families are being penalised in three ways as a result of having to buy a seven-seater car. First, it costs more to buy a car of equal year, for example, a 2005 car compared to a seven-seater car; second, the rate of motor tax is higher for a seven-seater; and, third, VRT will add to the cost of purchasing the car. I ask the Minister to look at the scheme. The danger of reducing a seven-seater car to a lower band is that it might encourage people with no family to drive a seven-seater car for the crack. That issue has to be protected. For families who have no option but to buy a seven-seater car something must be done in the areas of VRT and motor tax.

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