Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

This section extends the €10,000 deduction for benefit-in-kind purposes applied to the original market value of a car or van in categories A to D as well as the amendment to the lower limit of the highest mileage band for a further year to the end of December 2024. These measures were originally introduced as temporary measures in the Finance Act 2023 earlier this year and they also apply to electric vehicles. In line with the original measure this extension does not apply to cars in emissions category E, which is the highest emission category.

The reason I am extending these measures for another year is because of the cost-of-living and inflationary challenges that our economy continues to face. I am also extending the tapering mechanism that provides benefit-in-kind relief for battery electric vehicles for a further two years, to end on 31 December 2027. What this means is that the current deduction of €35,000 to the original market value for battery electric vehicles will remain until 31 December 2025 and will then be reduced to €20,000 in 2026 and €10,000 in 2027.

Deputies should note that the combination of both measures means that total relief for battery electric vehicles for 2024 will continue to be €45,000. This is the €35,000 that is being maintained plus the broader €10,000 relief.