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

I thank the Deputy for raising this issue. He should note that vehicle registration tax is an emissions-based tax calculated on the value of the car. There is no specific VRT rate for cars with this type of technology.

Under the Finance Act 1992, VRT is assessed on a vehicle at the time of registration in the State and the way it is calculated depends on the category of the vehicle involved. VRT on category A vehicles, generally passenger cars and certain special utility vehicles, is based on the vehicle’s value and its emissions level, with higher charges for higher emitting vehicles of the same value. There are two components of the VRT charge for these vehicles, relating to their carbon dioxide, CO2, and nitrous oxide, NOx, emissions. The CO2 component of the VRT charge is calculated by multiplying the value of the vehicle - its open market selling price - by a percentage from a 20-band table, with the vehicle’s CO2 emissions level determining which band applies. Vehicles with the lowest CO2 emissions fall into band 1, charged at 7%, while those with the highest emissions fall into band 20 charged at 41%. The NOx component of the VRT charge is calculated using a progressive scale, starting from €5 and rising to €25 per mg/km of the vehicle’s NOx emissions level. The VRT for category B vehicles, generally light commercial vans, is 13.3% of the value of the vehicle. There is a flat VRT charge of €200 for category C vehicles, which include larger commercial vehicles, agricultural tractors and buses.

The appropriate category is decided at the time of registration based on the vehicle’s technical categorisation under EU type-approval law, taking account of the documentation presented at the time of registration. The classification of vehicles for VRT purposes reflects to a significant degree the categories used for the EU classification of vehicles as set out in EU legislation, particularly those relating to the type approval of passenger vehicles, two- and three-wheeled motor vehicles, and agricultural or forestry tractors. All vehicles must have type approval and the National Standards Authority of Ireland is the Irish type-approval authority. The changes made to VRT structures in recent years have been focused on incentivising the uptake of low-emissions vehicles. The overall approach to tax policy is kept under review as part of the tax strategy group, TSG, and the budgetary cycle.

In summary, VRT is determined by the type and emissions value of the car, as per the recent changes made to the VRT structure. No account is taken of features in cars, such as advanced driver assistance technologies, which can assist drivers in driving and parking functions. Additionally, there is no mechanism by which VRT is applied to vehicles on the basis of safety or likelihood of the vehicle being involved in road traffic accidents.

See this speech in context