Budget 2015: No Increase for Fuel, VRT or Motor Tax

date-icon 14 Oct 2014  author-icon Posted by Miriam O'Neill


AA PLEASED TO HEAR MINISTER STATE ‘NO INCREASES FOR FUEL, VRT OR MOTOR TAX’

The AA was pleased to hear Finance Minister Michael Noonan explicitly state during his budget speech that there is to be no increase in taxes on petrol, diesel, VRT or Motor tax.

“We were obviously pleased to hear Minister Noonan’s words in his speech today.” Says Director of Consumer Affairs Conor Faughnan. “This means the cost of motoring did not get any worse today, which is a relief.”

The AA believes that the succession of austerity-era tax increases on fuel have been so severe that there was simply no scope for increasing them again.

“Fuels taxes were raised on 5 separate occasions since the first austerity budget of October 2008.” Says Faughnan. “Those increases combined to add 23 cent per litre to the retail price of both fuels. The price advantage we once enjoyed over Northern Ireland is all but gone; any further increases would send so much trade north that they would actually cost the exchequer money.”

While most motorists will be relieved to have been spared the AA says that there are still reforms needed for motor tax which currently discriminates very heavily against older cars.

“Approximately 75% of Ireland’s 1.88 million private cars date from 2008 or earlier and are therefore taxed on the old system based on engine size.” Says Faughnan. “For those that have larger engines the tax burden on them has become very unfair.”

“Someone lucky enough to be able to buy a brand new luxury car for €45 or €50,000 is likely to pay €270 per annum in road tax. Compare that to someone who cannot afford to replace an 8 year old run-about with a 2.2 litre petrol engine; that car costs €951 to tax every year. It is an anomaly that needs to be addressed.”

Fuel taxes explained:

Petrol :   

Pump price                                                            €1.543  

Excise including carbon                                       58.771c

Nora                                                                             2c

Vat                                                                                28.86c

Total taxes:                                                               89.631c

Pre-tax price                                                            64.669c

Tax as %                                                                      58.1%

 

Diesel :           

Pump price                                       €1.446

Excise including carbon                  57.902c

Nora                                                         2c

Vat                                                           27.03c

 Total taxes:                                         86.932

 Pre-tax price                                      57.668

Tax as %                                                60.01% 

Note: AA Fuel Usage figures: If a car does 12,000 miles per year (19,200 kms) at a fuel consumption rate of 30 miles per gallon (9.42 litres per 100 kms) that car will use 150 litres of fuel per month. At current prices that motorist will pay €231.45 month for petrol of which €134.47 is tax. The annual cost is €2,777 of which €1,614 is tax. For diesel, a similar car will pay €216.9 per month of which €130.35 is tax; or €2,602 per annum of which €1,564 is tax.

 

Written by Miriam O'Neill
Miriam O’ Neill, PR Exec at AA Ireland began working in the AA in August 2010. Miriam’s core activities on a day to day basis include management of the AA’s media relations programme, generation of quality coverage in support of key business lines, provision of content for AA social media channels and the AA customer Ezine, regular broadcast interviews, occasional events management and interactions with the large AA customer base on motor policy issues.