Eamon Ryan (Dublin Bay South, Green Party)
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As highlighted recently by the Climate Change Advisory Council, transport emissions grew by 6% in 2022, reflecting the rapid return to economic growth, full employment and continued population growth in Ireland, following a prolonged period of artificially reduced activity during the Covid-19 pandemic.

Decoupling the direct correlation between transport emissions and wider social and economic activity thus forms the fundamental challenge for the sector. For this reason, our focus is on pursuing measures to address travel demand - in the first instance by pursuing policy measures that promote greater efficiency in our transport system, allied with significant investment in sustainable alternatives and incentives and regulatory measures to promote the accelerated take-up of low carbon technologies.

With respect to taxation policy, officials in my Department engage with the Department of Finance on a regular basis to monitor vehicle uptake and developments in the vehicle taxation area. New proposals are considered and current vehicle tax policies are kept under regular review as part of the Tax Strategy Group and Budgetary cycle.

It should be noted that the existing vehicle tax structures for vehicle registration tax (VRT) and motor tax in the State currently have a very strong environmental rationale, with the more pollutant vehicles paying higher rates of tax.

These emissions-based taxes are calculated based on the Open Market Selling Price and the tailpipe emissions of the vehicle. The rates were changed in Budget 2022 to further incentivise motorists in the market for a new car to make ‘greener choices’.

The changes to the rates table increases tax rates progressively from band 9 so that high emission vehicles pay more. This reflects the environmental rationale of the tax and underpins Government commitments to decarbonise road transport.

In recognition of the environmental health costs caused by pollutants emitted in particularly high quantities by diesel vehicles, Budget 2019 saw an introduction of a 1% surcharge on all diesel vehicles. Budget 2020 replaced the 1% surcharge with a surcharge tied to nitrogen oxide emissions levels based on the “polluter-pays” principle, where the greater the level of nitrogen oxide a car emits, the higher the surcharge. Budget 2021 saw an adjustment to the surcharge structure so as to underpin its environmental rationale and incentivise the uptake of cleaner cars.

The motor tax system was also reformed in Budget 2021, in line with Government commitments to reduce emissions from road transport and in the context of transitioning to the new Worldwide Light Test procedure (WTLP) emissions testing regime. In order to do this the existing New European Driving Cycle (NEDC) motor tax table was adjusted to reflect climate action priorities and to ensure a level playing field with the introduction of the new WTLP table

The policy of changing the profile of vehicles being registered in this country is working. Following the changes introduced in recent years, significant increases in EV registrations have been mirrored by decreases in the number of high emission vehicles. The middle emissions bands (where most of the volume lies) have also experienced a shift towards lower emission vehicles. The average emissions figure for all vehicles (new and used) in 2020 was 135.6 gCO2/km (band 14). This has fallen to 103.4 gCO2/km (band 7) for 2023. This is clear evidence that vehicle taxation reform is leading to lower emission cars on our roads.