Thursday, 2 December 2021
Department of Finance
30. To ask the Minister for Finance if he has plans to modify the accumulated rates of VRT, NOX surcharges and tariffs that apply to the importation of vehicles from Northern Ireland which is causing a disproportionate hardship to persons in the Border region by driving up the price of second-hand vehicles; and if he will make a statement on the matter. [59690/21]
VRT is a tax chargeable on the registration of vehicles in the State and is levied as a percentage of the open market selling price (OMSP) of the vehicle. It is a nationwide tax paid upon registration of a vehicle in the State, based on its emissions profile. A VRT surcharge based on nitrogen oxide (NOx) emissions levels was introduced in Budget 2020 in recognition of the negative externalities these emissions have on public health and the environment. The NOx pollutant is generally emitted in greater quantities by older diesel cars. Budget 2021 saw an adjustment to the VRT rates structure to underpin the environmental rationale of the tax and incentivise the uptake of cleaner cars.
Customs Duty need not be paid on a vehicle first registered in Northern Ireland (NI) after 1 January 2021 where it meets the following conditions:
- the registration in NI was the first registration of the vehicle in the United Kingdom (UK)
- the vehicle has never been exported and, or re-registered in, Great Britain (GB) or any other country outside the European Union.
A vehicle brought into Northern Ireland before 1 January 2021, and which has remained there since, can be registered in the State with no customs obligations. However, proof of the vehicle’s status in Northern Ireland prior to 1 January 2021 will be required.
Vehicles first registered in GB, and subsequently registered in NI after 31 December 2020, will be subject to additional requirements if imported into the State. The same additional requirements will also apply to vehicles imported from GB to Ireland via NI. These additional requirements must be completed prior to presenting the vehicle for registration at an NCTS centre.
Where a vehicle has been declared to NI customs on import into NI, including payment of any customs duties, there will remain a liability to Irish VAT on import into the State. VAT will apply at the standard rate (currently 23%) and must be discharged before the vehicle can be registered.
In such cases, a Supplementary Import Declaration Form – VAT on Import on Used Vehicles, must be filed and the associated VAT on Import liability must be paid.
To avail of this procedure, the declarant must be able to provide proof of the NI customs declaration on import into NI. Such proof must clearly identify the vehicle and the date of import.
If the importer does not have proof of declaration to Customs in NI then an Irish customs declaration is required. Customs duty (if applicable), and VAT on the import value of the vehicle are payable. This must be done before presenting the vehicle for registration.