Irish Consumers Respond To New Vehicle Registration Tax Scheme

by Robert Lee, Tax-News.com, London

22 December 2008

Sustainable Energy Ireland announced in its new report on December 16 that since the introduction of the Vehicle Registration Tax and road tax in July 2008, Irish consumers have been purchasing more energy efficient vehicles.

SEI’s Energy Policy Statistical Support Unit composed the report entitled ‘Energy in Ireland 1990 – 2007’. The latest data shows that consumer preference, after the implementation of the tax, has been towards more energy efficient vehicles: between July and October 2008, 84% of new cars purchased fell into the most energy efficient Vehicle Registration Tax bands (A, B and C - i.e. emissions of less than 155 gCO2/km), up from 41% in the same period in 2007.

Brian Motherway, Head of Industry, SEI said:

“Today's report reveals a long term trend of improving energy efficiency in the Irish economy. This gain was made over a period of sustained strong economic growth. However, while the analysis of 1990 to 2007 charts a period of considerable change, the coming years of lower economic growth and increasing targets will require much greater and more rapid change.”

However, the European Automobile Manufacturers’ Association revealed figures last week that suggest the new tax has helped to decrease sales of light commercial vehicles markedly. The figures showed that registrations of these vehicles fell 60.4% year-on-year against the 31.8% EU average.

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