Pat Gallagher (Donegal South West, Fianna Fail)

The effect of this amendment would be to eliminate altogether the existing relatively low surcharge that applies to taxing one's car on a quarterly rather than annual basis. Fractions of a euro are rounded downwards for motor tax purposes and the proposed amendment would make it cheaper to tax a car on a quarterly rather than an annual basis. There would also be additional administration costs to take into consideration.

There is no sound basis for doing this. It would encourage a far greater degree of quarterly taxing, which would have two effects. It would significantly increase the administrative costs involved in the motor tax process which, in turn, would reduce the amount available for the local government fund and would also lead to an increase in queuing time in motor tax offices and a slowdown in the time taken to turn around proposed tax renewals.

Last week, I took the opportunity to visit the Shannon motor tax office which was decentralised many years ago by the then Minister for the Environment, the late Sylvester Barrett. I was very impressed with the efficient operation of the office, which employs some 80 people.

Acceptance of the amendment would provide an incentive for those who pay motor tax on an annual basis to revert to paying on a quarterly basis. If they all chose to do so, it would be extremely costly and not in our best interests. The effect of the amendment would be that all motorists who renew their tax quarterly, with the exception of motorists in the two lowest bands, would pay less than last year. This would militate against the intention of the Bill which is to raise money for the local government fund.