Robert Dowds (Dublin Mid West, Labour)
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A parliamentary question I asked of the Minister for the Environment, Community and Local Government, Deputy Phil Hogan, on 25 May uncovered two rather startling pieces of information. First, the value of off-the-road vehicle declarations for the 15 month period between May 2009 to July 2010 was over €94 million. This would equate to roughly €76 million per annum. Off-the-road vehicle declarations occur where the owner of a vehicle makes a statement, verified by the Garda, that the vehicle was not driven on the road for a period of time. Given the approximate €76 million per annum value, a substantial number of vehicles are being declared as off-the-road.

According to a report produced by the Dublin Motor Tax Office, 27% of the total number of vehicles registered in Monaghan in 2008 were declared off road for part of that year. The figure for the Dublin area was about 12%. In the motor tax office in Nutgrove, County Dublin, over 12,000 vehicles were declared as being off the road for part of the year in 2008. The figure for County Galway in the same period was 22,500. It is hard to credit that all these were genuine cases of vehicles being off the road.

Second, an off-the-road declaration for any month can only be accepted after that month has ended. This surely makes it possible to say that a vehicle has been off the road when it might not have been so.

I call on the Minister to do three things. First, he must take steps to review the procedure as soon as possible. I understand from the answer to a parliamentary question that he intends to do so. Second, he must introduce a better system, such as that which operates in Switzerland. In that country, when a vehicle is declared off the road, the tax disc is returned to the local authority for the period the vehicle is off the road. Third, if extra revenue comes in as a result of the reform, the benefit should be passed on to compliant motor tax payers in the form of lower motor tax.

One reason I raise this issue is because local authorities receive the money collected from motor tax through the local government fund. With streams of finance to local authorities in serious decline, it is important that levels of motor tax income are maintained. For example, my county of South Dublin, which includes Lucan, Clondalkin, Tallaght and Templeogue, has a population of about 250,000 and it received €24.29 million in 2010. The current yearly rate of motor tax being lost would fund three such councils, so I would appreciate it if the Minister addressed those issues.

Phil Hogan (Carlow-Kilkenny, Fine Gael)
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I thank the Deputy for raising this important matter. I am very concerned at the high level of off-the-road declarations being made. I am aware that current procedures governing the making of such declarations may be open to abuse.

Off-the-road declarations are made retrospectively to cover short periods, usually of a month, where motor tax was unpaid as the vehicle to which the declaration applies was not in use in a public place during the period to which the declaration refers. The current system allows for such a declaration to be witnessed by a member of the Garda Síochána. This was intended to discourage false declarations. However, it may be considered to be ineffective as the garda may be witnessing the signature on the declaration only and may not be in a position to verify whether the vehicle was in use on the road for the period in question. It could thus be argued that this process, designed to facilitate genuine cases where vehicles are not in use on a public road, is capable of being used to evade the payment of motor tax for short periods by making false declarations in instances where vehicles may have been used in a public place during the period of the declaration.

It is my strong view that this practice is exacerbated by the custom and practice of allowing a month's grace for the payment of motor tax. While this is not laid down in law, the approach has arisen from the period when renewing tax discs could be slow and time-consuming. This is no longer the case since the introduction of the online motor tax system. However, the common perception that this one month grace period exists probably feeds into the notion that driving without valid motor tax for short periods is acceptable.

The most recent verified figures available indicate that the value of off-the-road declarations made during the 15 months from May 2009 to July 2010, inclusive, was over €94 million. I have asked my Department, in the context of a general revision of motor tax law, to take steps this year to address the procedures in this area. While acknowledging that it will not be possible to remove off-the-road declarations completely, a system somewhat akin to that in use in the UK is being considered in the context of the development of a motor tax Bill, whereby off-the-road declarations will be possible only in advance for a specified period of no less than three months. It will not be possible for retrospective applications to be made, as these are in essence unlikely to be fully verifiable. I also propose to confirm the non-existence in law of the month's grace period to renew motor tax.

More generally, the motor tax Bill will consolidate and modernise motor tax law, and reform the administration of the motor tax system to ensure consistency, resource efficiency and best customer practice in service delivery.