Ann Phelan (Carlow-Kilkenny, Labour) | Oireachtas source

I thank the Senator for raising this issue. Last month in budget 2016, the Minister for Finance announced that the rates of motor tax on larger goods vehicles are being reduced. The reductions apply to goods vehicles with an unladen weight exceeding 4,000 kg and will take effect for vehicle licences taken out with a commencement date of 1 January 2016 or after. As part of the changes announced, the rate structure of 20 bands is being simplified to five bands of motor tax, which will range from the current level of €92 per annum for electric goods vehicles up to €900 per annum for all goods vehicles in excess of 12,000 kg. The cost of the reductions is some €43 million annually. This change will benefit the owners of more than 28,000 goods vehicles.

A week later, on 21 October, the Court of Appeal made a judgment on a case between the Director of Public Prosecutions and Perennial Freight Limited. If I was to summarise briefly the import of the judgment, it is that only the mechanically propelled element of an articulated vehicle - in other words, the cab of the vehicle - falls to be taxed on the basis this is the only part of the vehicle that is independently capable of mechanical propulsion. Up to that point, articulated goods vehicles had been taxed based on the weight of the cab and the heaviest unladen trailer or combination of trailers that would have been drawn by the cab. The judgment further ruled that articulated vehicles are more appropriately taxed as a different class of vehicle than had been the case up until this judgment. This is the category under which non-agricultural tractors are taxed and it has a single annual rate of tax of €333. The judgment does not affect rigid trucks which continue to be taxed on unladen weight.

The necessary technical adjustments have now been made to the national vehicle and driver file to apply the €333 rate. This has been done pending fuller consideration of the implications of the judgment and the appropriate response to it. Legal advice on certain elements of the judgment has been sought by my Department through the Office of the Attorney General and once it is received and considered, a decision on how best to proceed will be taken.

On that basis, I hope the Senator understands that at this point in time, I am not in a position to comment further on the matter.