Brian Cowen (Laois-Offaly, Fianna Fail)

The point to be made in this regard is that this proposal is at an early stage. The Commission has an idea and, as Deputy Bruton knows from his ministerial experience, many a proposal has been put forward by the Commission on which it was difficult to maintain a consensus when subjected to the white fires of domestic politics in the Council of Ministers. I could take the easy road and suggest that we will consider this positively on the basis that I know it is not imminent, but rather than taking both sides of the argument I make the point firmly that VRT is an important part of our tax system in terms of what it raises in revenue for the country. We must take that into account in terms of the mix of policies we have, including reducing taxes and keeping taxes on employment low, because that is a strategic view we have taken which has proved successful in terms of attracting foreign direct investment, generating economic activity and creating jobs for our people, which historically it could be argued was the major challenge facing successive Governments since we gained independence.

I listened this morning to some people who promote the interests of the car sector and they said that this proposal was imminent and asked why would we not begin to address this immediately. That is a narrow sectional view to take. I make the point clearly that this tax accounts for €1 billion in revenue, it has that benefit and it has not affected, as Deputy Bruton said, people being able to own their own cars which people need for transport purposes.

If the Commission has come forward with an idea that seems to be good and sends all the right signals, we should discuss it. However, I make it clear that if it is an attempt to harmonise taxes or bring the EU into an area of competence in regard to which we have carefully negotiated ourselves to a position where we retain our own competence, this is a fundamental issue. It is an issue I raised in regard to aviation fuel tax and one I will raise in regard to this and other areas where I consider a principle is being conceded which would have wider ramifications than simply the benign measure that has been suggested here.

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