Michael McCarthy (Cork South West, Labour)
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Deputies Mac Lochlainn and Doherty have two minutes and 30 seconds each in which to speak.

Pádraig Mac Lochlainn (Donegal North East, Sinn Fein)
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These changes to the commercial vehicle tax rules kicked in late last year having been introduced by a former Minister, John Gormley. The Fine Gael Party and our party came out against this at the time, as well as Mr. Conor Faughnan. It was made clear that the system would create a mess and have an impact on Garda resources, as gardaí would have to chase workers in their vans to see if the people had left their mothers to mass or children to school. It is a nonsensical regulation which reflected the lack of understanding of rural Ireland from the former Minister, John Gormley, backed by the Fianna Fáil Government of the time. In rural Ireland a vehicle is needed for everything and public transport is unavailable. A vehicle is a core part of living and getting by in rural areas.

Deputy Doherty and I have been inundated with complaints from across Donegal and we have checked with other rural Deputies, who also report an impact. Essentially, this is another device to take money from people to pay the EU, the IMF and banks; the money is not even going into schools, hospitals or roads. It is another tax affecting this area.

My colleague and I call on the Government to review this immediately so that a bit of common sense can be introduced. We must realise that it is outrageous to place this tax on small businesses, with most of the affected people from rural areas. The rule is that a commercial vehicle can only be used for work purposes. I ask for common sense to come through in an immediate review of the issue.

Pearse Doherty (Donegal South West, Sinn Fein)
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This is an appeal to the Government for common sense. We note the Fine Gael Party initially opposed this measure and up to now, colleagues in the party in Donegal and elsewhere in rural Ireland have called for a review. Sinn Féin has had the opportunity to raise the matter for the first time in this new Dáil.

Boiling the matter down, it is a tax on rural Ireland and small businesses. It is a silly measure that was just another way to find money. There is more to the issue as the penalties involved are quite severe. This new rule will apply an average tax of approximately €1,200 instead of a reduced rate for a commercial motor vehicle of €288. It is an average increase of €900 for people moving from the commercial to the private tax. As Deputy Mac Lochlainn mentioned, this involves people dropping kids off to school or collecting them from a childminder. It will take in people going to the shop on the way home from work. They will not be allowed to do any of this as they are bound under this rule to sign a declaration in a Garda station indicating that the vehicle will not be used at any time for social, domestic or pleasurable purposes. If these people break the rule, they can fined or imprisoned. I spoke earlier about bankers walking away scot-free but under these rules, ordinary people will suffer severe penalties.

The Minister of State may not have a direct response to this tonight but I ask for the issue to be considered in the context of the upcoming jobs initiative or budget, where the Government, like all of us, is seeking to create jobs. We can do that here. It does not make sense for us to ask the self-employed man or woman, who needs a van for work and who may want to collect their children or go to the shop, to buy a separate car. That will place an unnecessary burden on people. These people must have tax clearance certificates and other red tape, which we all want to reduce.

If the Minister does not have a direct reply tonight, I ask for this measure to be eliminated in the jobs initiative. As my colleague has mentioned, much of this is taking up Garda resources, with gardaí checking the back of cars to ensure there is no shopping from Aldi, Dunnes Stores or the local grocer. It does not make sense.

Fergus O'Dowd (Louth, Fine Gael)
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I thank the Deputies for raising the matter and I will bring the points made to the attention of the Minister, Deputy Phil Hogan. The position regarding the taxation of goods vehicles has not changed. In August 2010, the Department of the Environment, Heritage and Local Government issued a circular to motor tax offices reminding authorised officers of existing provisions with regard to the taxation of vehicles on a goods basis. This circular reiterated the terms of an earlier 2005 circular.

To be taxed as a goods vehicle, a vehicle must be constructed or adapted for that purpose and used solely in the course of trade or business. The Deputies are raising issues where such a vehicle is used in the course of ordinary family life, such as in going to mass or picking up the newspaper on the way to work. These are normal social interactions as people drive their vehicles. The points made at that time have validity: why should a farmer not stop off at a shop to get a newspaper, just as anybody else does?

If a vehicle is adapted, it must have the same characteristics as a goods vehicle with regard to space and accommodation for carrying goods. The vehicle must also be used in the course of trade or business. Under section 2 of the Finance (Excise Duties) (Vehicles) Act 1952, if a vehicle is used in a condition or manner which would attract motor tax at a higher rate, tax then becomes payable at that rate. In other words, if a goods vehicle is used at any time in a private capacity, it must be taxed at the private rate of motor tax. The key point is that common sense must apply.

Under Article 3 of the Road Vehicles (Registration and Licensing) (Amendment) Regulations 1992, a licensing authority must be satisfied that it is authorised to issue the licence applied for and, accordingly, that it is the appropriate licence for the vehicle. It is thus open to a motor tax office to seek documentation to support an application. Such documentation could include, but is not limited to, a certificate of commercial insurance, evidence of registration for VAT or a tax clearance certificate, or any other document that would assist in satisfying the licensing authority as to the basis for the application. I do not think that, as the Deputy said, having to present a tax clearance certificate constitutes red tape. That is an important point. If a vehicle is used for commercial purposes, the user should have a tax clearance certificate, just as you and I need tax clearance certificates to sit in this Dáil. It would not be expected that any person genuinely using a vehicle in the course of trade or business would have difficulty in providing such documentary evidence if requested to do so.

The goods declaration form RF 111A, which has been in existence for a number of years and is not a new requirement, constitutes a statement by the applicant that the vehicle is being used in the course of trade or business. This declaration should not need to be sought at every renewal if the particulars of the vehicle have not changed, but it is normally sought at the time of first taxing as a goods vehicle and on change of ownership. The only minor amendment to this form is that the income tax registration number of the applicant is now requested, which is also perfectly reasonable.

I reiterate that the legal provisions governing the taxation of goods vehicles have not changed. However, evidence was brought to the Department's attention that high-powered, high-specification vehicles that would not normally fall into the goods vehicle category are increasingly being claimed as goods vehicles. In that regard, it is important that motor tax offices follow the requirements to ensure a vehicle is taxed properly. If a concessionary rate of tax is being claimed in circumstances in which it is not warranted, the concomitant loss of income would in the normal course of events have to be recouped elsewhere. All road users should pay their fair share of motor tax in line with the relevant legal provisions. The Minister, Deputy Hogan, intends to review the taxation classes currently in place for motor vehicles. As I said at the beginning, I will bring the Deputies' views to the attention of the Department for direct response.