Phil Hogan (Carlow-Kilkenny, Fine Gael)

I will come to that in a minute. If the Minister was serious about encouraging people to buy smaller and cleaner cars, he should have frozen the lower tax rates. At the very least he should have made up the shortfall on larger vehicles, and there would be sound environmental reasons for doing so, but he did not do that. The Bill as drafted implies that cars of 1.1 litres are as clean as those with 2.4 litre engines. Of the 180,754 cars registered in Ireland in 2007, only 10,295 were above 2.4 litres. If the Minister disagrees with my assessment of his intentions then he should introduce more graduated tax bands as part of this Bill that would reward people's choice of smaller cars in the 1.1 to 1.6 litre range. Instead, the Minister is intent on hiking small car taxes up to the same level as bigger vehicles which, in large measure, cause more pollution.

We have a lot of thinking to do as regards how we will deal with motor tax bands in future. It would seem, however, that the Minister has learned a lot in his short time in Government with his Fianna Fáil masters, as these car tax increases have less to do with saving the environment than with raising hard cash to meet the shortfall in his Department's Estimate, which he was given by the Minister for Finance, Deputy Cowen, in the latter part of 2007. This increase in motor tax represents a direct stealth tax of €83 million hitting every household and family in the country. Only €53 million of that money will be given back as an increase in this year's local government fund. He was forced to raise this revenue because the Minister for Finance said he did not have the money to give the Minister, and would only give so much. I am sure the Minister offered the possibility of raising motor tax to assist the Minister for Finance in his financial forecasts and Estimates for 2008.

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