VRT Calc - Double Taxation?

darag - Revenue have already stipulated that VRT doesn't penalise purchases outside of the state so that's a no go (I'll post their response tomorrow). I am going to write back to them with the VAT example and see what they say. They are exceedingly cagey in their responses and to get them to admit to a mistake in calculation will be nigh on impossible. No harm in trying though.

I'll look into the SOLVIT area and try and educate myself in the workings. I may come back to you in the future if you don't mind. Thanks for your help.
 
I looked at the SOLVIT site and there is a link there to some factsheets for the European Commission. One of which describes vehicle registration laws which are yet to be unified across the EU :

[broken link removed]

Selecting Ireland and English takes you to the following:

[broken link removed]

Typical.

Although there is this : [broken link removed]
 
Last edited:
Sonny, if revenue are really claiming that the current method of calculation doesn't penalize purchases outside the state, then they are simply wrong and it shouldn't be at all difficult to prove this.

Of course they are being cagey!! If they admit that there is a penalty, then they realise that they've f*cked up big time. They may even be liable to refund the difference which for example will be 23% of the VRT they've collected from people who've imported 2,001CC (or more) cars. I suspect the amount involved might be significant so you might have a fight on your hands.
 
does anyone work in the motor industry. ? if so, could they gather the numbers
-base price, vat and vrt elements for a specific new model. if revenue then quote the exact same figure to joe public attempting to import the exact same brand new model from uk then, all is fair, otherwise they dont have a leg to stand on. either way, it would end the speculation.
 
it is also widely known that we have some of the cheapest PRE-TAX car prices in the EU so comparing Pre tax prices in Ireland to UK isnt really going to work out correctly.
 
That's true Ronan but this is much simpler. You only need to prove that the calculation is discriminatory which it is. We can avoid the whole vagueness around how OMSP is derived. In fact I suspect the statement "In the case of cars and small vans, the VRT payable is a percentage of the expected retail price, including all taxes in the State." which is on their website is incriminating enough since the VRT retailers in Ireland pay is calculated on a more favourable basis - i.e. ex VRT.
 
darag - not sure they are more favourable. The calc is the same for a new car as it is for a secondhand car. It includes VRT. If a car is 20k book, add on the VAT etc then add on 30% VRT. This gives you the OMSP of the new car. The VRT is then 30% of that value. This then ties in with your VAT example?

I'll post the exact wording tomorrow and maybe someone less confused than I can interpret the meaning.
 
Last edited:
the wording is freely available, its how it is implemented that in question.
 
i was looking at all the comments about vrt tax and agree its a sick invention by the irish tax authorities (in cahoots with the irish motor sales industry!)to prevent loss of sales in ireland of new and used cars to cheaper Continental sellers.that lovely new BMW showroom in finglas would close over night if we could all fly to Germany with ryanair and drive back with a brand new top of the range BMW ,with a serious wad of euros left over in our pockets.ireland would cease to have a motor industry (as is)but a few dealers willing to reduce profits and margins would come to the fore selling cars on par with Europe thus restoring the natural balance of commercial life.but the government in its wisdom continues to support this monopoly at its citizens cost .shame on them . its like if the government had tried to save the t-shirt manufacture industry in donegal by taxing foreign imports from china to give the irish guys a barrier..! its the same thing! ever tried to buy a car lately ? i have and was met with salesmen smug in knowing that the dealer in the country was not going to undercut him as the cartel has been sealed ...no more do salesmen fall over themselves to seal the deal .its "thats the price take it or leave it !"if i could turn around and say well Gunter in Germany is charging 3k less what bargaining power that would be ! i was thinking would it be possible to say ,buy a new car in Latvia in a shelf company's name and set up some token rental agreement ,where by you are the renter of the car ,so when you bring it to Dublin you are only the renter not the owner !so ,would you still have to pay vrt ? vat? only vat in country of purchase .rental agreement could be in such a way that the ownership is transferred to you after say 5 yrs .the money would be held in a swiss bank ,and as you are a director can be recouped also.i know alot of maybes but when you hear what the big fish do to avoid paying alot of tax maybe its not that far fetched ? any one wanna start a company ;)
 
Ok so the offical response from the revenue is as follows:

Section 132, Finance Act, 1992, provides that VRT shall be charged on a category A vehicle at the rate of a percentage of the value of the vehicle. Section 133 of the Act provides that the value shall be taken to the open market selling price ("OMSP") of the vehicle at the time of the charging of the tax thereon.

The section provides that the OMSP of a new vehicle on sale in the State, which is supplied by the manufacturer or sole wholesole distributor, is the price declared to the Revenue Commissioners, inclusive of all taxes and duties, which, in the opinion of the manufacturer or distributor, a vehicle of that model and specification, including any enhancements or accessories fitted or attached thereto or supplied therewith by such distributor, might reasonably be expected to fetch on a first arm's length sale thereof in the State by retail. Thus two new cars of the same make, model, version, and specification, supplied by the sole wholesale distributor, registered on the same day, will attract the same amount of VRT.

The section provides that, in the case of any other new vehicle, the OMSP is the price, inclusive of all taxes and duties which, in the opinion of the Revenue Commissioners, would be determined under the section if the vehicle were on sale in the State following supply by a manufacturer or sole wholesale distributor in the State. Thus a new car, of the same make, model, version, and specification, as the cars mentioned above, registered on the same day, but supplied other than by the manufacturer or sole wholesale distributor, would attract the same amount of VRT.

The section provides that, in the case of a category A vehicle other than a new vehicle, the OMSP is the price, inclusive of all taxes and duties, which, in the opinion of the Revenue Commissioners, the vehicle might reasonably be expected to fetch on a first arm's length sale thereof in the State by retail, such price to include the value of any enhancements or accessories which, at the time of registration are not fitted or attached or sold therewith but which would normally be expected to be, unless it is shown to the satisfaction of the Revenue Commissioners that they have not been removed or not sold therewith for the purpose of reducing its OMSP.

The Revenue Commissioners determines the OMSPs for vehicles other than new vehicles by methods including reference to trade guides, advertisements, and consultations with the trade and other knowledgeable persons.

And in response to a subsequent letter asking for clarification that 'all taxes' includes VRT:

The expression "all taxes" does includes VRT. VRT is charged once only on registration of the relevant vehicle.
 
RonanC: Thought the brits got this sorted ie car manufactures/suppliers can no longer charge higher base prices in uk before tax. almost certain they have levelled the pitch with most EU countries.
 
importing a stretch Hummer

Hi Guys

I am Looking at importing a stretch Hummer to Ireland to hire out etc. Has anyone else gone down this road with the Revenue and as
(is it a Commerical,) OR class (a) what VRT ? will i have to pay and vat if it a us import

Regards
 
cuchulainn said:
RonanC: Thought the brits got this sorted ie car manufactures/suppliers can no longer charge higher base prices in uk before tax. almost certain they have levelled the pitch with most EU countries.
Click to expand...

Car Manufacturers can charge whatever price they like, in any country. The only legislation which has been passed forbids the restriction of car sales in any country, to customers from another country. VW have been the biggest losers suffering a huge fine for anti-competitive practises. Unfortunately the derrogation that allows VRT is still in place.
 
To answer Glenbhoy earlier in the thread:
if you think forking out over €550 per year in road tax is a few euro then I want your salary/income.

That amount does not count all the other ancilliary charges for using our brilliant road network. There are tolls on the M50 traffic jam, the M4, the East Link, the M1 and most of the other new roads.

I drive down West almost every two weeks. That costs me €5 for the priviledge of using the new M4. Check out how may commericals use that road and you see how successful it has been in diverting heavy goods vehicles away from Enfield and Kinnegad. It's a joke.

The motorist helps pay for a lot more than the roads. They are easy targets and the fact that VRT remains flies in the face of the supposed free movement of goods within the EU.
Rant over with....

My question is how can VRT be phased out since if you drop it immediately you will have an outcry from existing car owners that the value of their cars have been slashed overnight ?
Why buy second hand when you can buy as cheap new.
Would it be phased out over 3/4/5 years ?

I can only just wonder what our immaginitive government/civil service come up with as it's replacement - an emmissions tax ?


[broken link removed]
 
I agree there is double taxation on the vrt calculation and even more there is a triple taxation if there is such a term.

For instance if a cars open market selling price is 10000 euros and the vrt is 30%. The VRO calculate it in the following way. Firstly they get 30% of 10000€ which is 3000€ and then they add 21% Vat not on the 10000€ but to the 13000€ which adds up to 15730€. If we take 15730€as a percentage of the OMSP of 10000. this equals 63.57%. Thats the amount of tax we are really paying. The revenue like to disguise it but some clever clogs in the ivory tower came up with this creative tax calculation.

My second point is that the OMSP seems to be calculated on the Irish market only. As part of the EU we should be able to find products i.e. cars european wide and pay the lowest price without penalty. Isnt that what being part of europe is all about?? So if i find a Toyota avensis in the UK for £5000stg and convert the price using todays exchange rate of 1.40 the car would have an European Open market selling price of 7000€. If you look at the Irish market the same car has an infalted value of 15000€. Surely i should be able to pay VRT on the 7000€, as we are part of the european single market. This would mean my vrt bill would be 2100€ instead of 4500€ a saving of 2400€.
 
Glenbhoy said:
I'm sure Eddie would love to help out.
VRT is a tax, and a pretty fair one at that, if it's removed that money will have to come from elsewhere.
I can't see why the EU would comment on VRT as it is an internal road tax that does not hinder free trade etc, given that, I don't see what grounds there are for a legal challenge, sure we may as well take a legal challenge against income tax too.
Click to expand...

In 2002 the European Court of Justice ruled that aspects of VRT constitute a form of double taxation and are therefore illegal under the EU treaty. It also hinders free trade.

The ruling came in after a Finnish citizen took a case against his own government. He claimed that by levying VRT on a used car he had imported into Finland, the government taxed the same car twice, because the tax ignored the value of the tax already paid on the car in another member state

The EU court ruled that the VRT law in Finland conflicts with the EU treaty, and is illegal. The ruling should affect the operation of VRT in Ireland

The European Commission has also called for the abolition of vehicle registration tax in the EU. Until its abolished they said that states should ensure that their VRT systems did not discriminate by imposing a double taxation burden on motorists importing second hand cars from other member states

There is a clear case that could be taken here on Irish VRT double taxation
 
briancbyrne said:
if you have a house abroad in mainland europe can you register the car there and drive it here without having to pay vrt?
Click to expand...

Gone Fishin' said:
No you cannot. If you are resident here you must register your car here. Resident means spending over 182 days in the country in the year.
Click to expand...


Whats to stop you registering the car into the name of a relative living at an address abroad e.g London ? The relative says he wants the car to use when he visits home, therefore imports it and leaves it in the republic. I pay him off and I get to drive a flash motor but registered in his name at the foreign address? :) ?

Then at some point in the future we can transfer the names across.

I was just discussing this today. A friend of a friend is doing exactly this. And I hear about people with addresses up the North doing this too. Are there any pitfalls or a downside I dont see ?
 
...as an aside, if there has been a ruling by the european courts holding this taxation illigal, and we as a country voted to join the EU and changed our constitution to reflect this, would this tax not represent a contravention of our constitutional rights as both Irish & EU Citizens ??
 
stir crazy said:
Whats to stop you registering the car into the name of a relative living at an address abroad e.g London ? The relative says he wants the car to use when he visits home, therefore imports it and leaves it in the republic. I pay him off and I get to drive a flash motor but registered in his name at the foreign address? :) ?

Then at some point in the future we can transfer the names across.

I was just discussing this today. A friend of a friend is doing exactly this. And I hear about people with addresses up the North doing this too. Are there any pitfalls or a downside I dont see ?
Click to expand...


But is there anything to stop me driving somebody elses (a relatives) car which I dont own ? :confused:
 
You must log in or register to reply here.
Back
Top