Paudie Coffey (Waterford, Fine Gael) | Oireachtas source

I thank the Senator for his kind comments. I look forward to working with him and many colleagues in the House.

I thank the Senator for raising this matter which I am taking on behalf of the Minister, Deputy Alan Kelly. I acknowledge the importance of a healthy and competitive haulage industry to our general economic welfare and employment across all areas of the country.

Changes to the procedures for declaring vehicles off the road came into effect on 1 July 2013. The Non-Use of Motor Vehicles Act 2013 replaced the system whereby a vehicle was declared to be off the road retrospectively, which was unverifiable, and put in place new arrangements to allow motorists to make provision for genuine periods of non-use of a vehicle. For commercial vehicle owners, this could be for anticipated downtime or due to cyclical business demand.

The arrangements for off-road declarations only allow for a future declaration. It must be made in advance of the vehicle being taken off the road, in the month before tax falls due or when a previously made declaration of non-use expires. The declaration of non-use can be made at any time during that month, for free, online or at a motor tax office. An owner can return the vehicle to the road early if circumstances such as an increase in trade require it simply by taxing the vehicle, effective from the first day of the month in which it is taxed. As the taxation period which can be three, six or 12 months is due to expire, the owner can make a fresh off-road declaration, if he or she wishes.

An estimated €55 million was being lost annually through motor tax evasion linked with retrospective declarations. Motor tax receipts for the half-year to the end of June 2014 are €47 million ahead of those in the same period in 2013, despite the fact that there has been no increase in motor tax in the intervening period. While not all of the increase in motor tax income can be attributed to the change in the rules for off-road declarations, it is clear that the measure is having an impact. The new arrangements strike a balance between the need to tackle tax evasion which hurts compliant motor taxpayers and a degree of flexibility to allow vehicle and fleet owners to arrange their affairs only to pay motor tax for periods their vehicle is in use on the road.

Given the extent of tax evasion which was for many years facilitated by retrospective off-road declarations, it is not intended to reintroduce retrospective declarations, accompanied by tax credits, as to do so would risk reopening the evasion loophole via motor tax credits.

The introduction of such a scheme for hauliers would inevitably lead to calls for similar treatment from other categories of road users, risking ultimately completely negating the improvements in the fairness of the motor tax regime introduced last year.