Seymour Crawford (Cavan-Monaghan, Fine Gael)
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Question 7: To ask the Minister for Finance the total tax generated from the motor sector in 2002, 2003 and 2004; the main components of tax raised from that sector; and if he will make a statement on the matter. [7172/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am informed by the Revenue Commissioners that the relevant information available is the amount of tax revenues collected as VAT, excise and VRT in respect of motor vehicles. As regards VAT, all figures are estimates as the information to be furnished on VAT returns does not require the yield from particular sectors of trade to be identified. It is not possible to quantify corporation tax or income tax data separately for the motor industry.

In 2004, the provisional tax revenue was €3,752 million. This was comprised of VAT on a range of commodities including mineral oils, vehicle sales, other motor-related products and services of €962 million; mineral oil tax in respect of petrol, diesel and LPG of €1,845 million; and VRT of €946 million. In 2003, the tax revenue in respect of the motor sector was €3,256 million comprising VAT of €880 million; mineral oil tax of €1,557 million; and VRT of €819 million. In 2002, the tax revenue was €3,167 million comprising VAT of €860 million; mineral oil tax of €1,514 million; and VRT of €793 million.

In respect of annual motor tax, I am advised by the Department of the Environment, Heritage and Local Government that revenue from motor tax was €747 million in 2004, €680 million in 2003 and €539 million in 2002. As the figures illustrate, the tax raised from the motor sector is an important component of the overall tax take. It is a matter for Government as to how taxes across the different tax heads are raised. The Government has prioritised tax reductions on income earned by employees, in preference to other areas, and this policy has helped create record employment levels. The Deputy might wish to note that I did not increase VRT, VAT or excise rates on petrol or diesel in this year's budget. Consequently, increasing tax revenues arising from car sales to date in 2005 is a function of increased sales and, in some cases, higher prices but not higher tax rates.

Richard Bruton (Dublin North Central, Fine Gael)
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Will the Minister agree that motorists have become something of a soft target? To put a car on the road now, the average tax contribution is over €2,500 and as the Minister's reply has revealed, that contribution is growing rapidly. Will the Minister accept it is time to reassess the extent to which we depend on this type of expenditure tax on what is for many people a necessity in terms of their livelihood? Does he sense that this huge growth in tax in this area, which the Minister seldom adverts to — the concentration is exclusively on what I believe he said yesterday was a €4 a week reduction in income tax that he secured——

Brian Cowen (Laois-Offaly, Fianna Fail)
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No, it is not. The Deputy is not telling the whole story.

Richard Bruton (Dublin North Central, Fine Gael)
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The amount a person has to pay on his or her motor tax is far more than the €4 a week reduction of which the Minister is so proud. The real issue for the Minister is that tax in this area has doubled in the past seven years, and spending has doubled to match, but what frustrates many people is that they do not see the delivery in the health service and the quality of footpaths, roads or public transport. There is a serious issue in that there are soft targets in the Minister's tax approach and he is not delivering value for money. People are getting frustrated with that combination, as frustrated as the Minister's predecessor who must have thought there was a boiler in the Custom House burning money it was absorbing so much.

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am glad to have the opportunity to record the achievement of which I am so proud because Deputy Bruton likes to hear only the first part of the sentence and shout down the second part. A total of €220 less in tax is being paid by the average industrial wage earner this year compared with 1997, while his or her wage has increased by €11,000. Instead of an average industrial wage of €19,000 when the coalition Government was in office, the average industrial wage now is over €30,000. Despite the fact that his or her wages have risen by €11,000 per year, they are actually paying €220 less in income tax. That is what I am proud of and that is not a difference of €4 per week. I am glad to clarify that point so that we do not continue with the misapprehension that I am proud of a change of just €4.

The second point made by the Deputy relates to this basic choice. The Deputy wants to be a friend to the motorist and seek to review this area with a view to indicating to the public that he will reduce these taxes, despite the fact that a function of these increases has been the buoyancy in vehicle sales. We know all about that from our own experience in terms of the numbers of cars on the road over the past ten years and what is estimated to continue to rise. The level of car ownership in this country is very high. If the Deputy wants to do that he will have to ask the public from where will we get our taxes.

By taking the decision to keep taxes low on income we have far better prospects of increasing job creation and the numbers of wage earners who will contribute to the buoyant revenues of the economy. We believe the model of taxation under the various tax heads is probably the best one as we see it. Others might disagree but if they want to change it, they should tell the public the full story. If they reduce it in one phase, where will they increase it because we cannot try to be a friend to everybody and leave things as they are?

I do not accept that we are not seeing an improvement. The national development plan is being rolled out. For example, if one travels on the N2 today one can see the amount of work taking place on the Ashbourne Road, which happens to be in Meath — with the by-election we might as well be topical.

Joan Burton (Dublin West, Labour)
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There are no buses on the road. The Minister should try to get a bus or ask his colleague, the Minister for Transport, if he can get one. He might not suffer from car sickness then.

Brian Cowen (Laois-Offaly, Fianna Fail)
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I knew that would prompt Deputy Burton to seek to shout me down. There are about 17 machines on the road and another 20 or 30 are due to come on to it. As soon as that road is completed, we will move on to the N3. The chambers of commerce in the Meath constituency made it clear in committees — I hope members of the press were in a position to attend — who they regard as the strongest proponents of the necessity for the N3 to go ahead. They were thankful of the consistent position of the Fianna Fáil Deputies in their constituencies as distinct from manoeuvres being made by others who have now finally recognised that over 80% of the constituents of Meath want to see that road go ahead as quickly as possible.