New Economic Report supports major Motor Tax reform

Colm McCarthy European Economic Forum Dublin Castle 19/4/12

A new economic report from leading economist, Colm McCarthy, shows that substantial reform of Ireland’s motor tax system is necessary. The report claims that the current level of tax on new cars is hindering motorists from switching to newer greener models thereby facilitating rather than reducing carbon emissions.
The report also highlights the need for reform to safeguard the amount of revenue that the Government gains from motor taxes for the maintenance and safety of Ireland’s transport system. The independent report was commissioned by the Irish Car Carbon Reduction Alliance (ICCRA), which includes the majority of car dealers in Ireland, representing almost every brand.
“Urgent action is needed across all sectors of the economy and we recognise that the motor sector and motorists have an important role to play. We required an independent expert review of the present situation so that we can make a real contribution to the important discussions taking place at national level. We wanted to bring realistic ideas to the table that could aid the Government’s ambition to reduce the carbon footprint of the cars on Irish road,” states Denis Murphy, spokesperson for the ICCRA.
“Currently, we have one of the highest levels of car emissions in Europe. Reducing it can be achieved in one of two ways – by reducing the number of car journeys or by driving cleaner cars. The former requires a cultural change and significant investment in public transport, particularly in rural Ireland, where car mileage is highest. The latter can be achieved almost immediately by addressing the main underlying reasons preventing the purchase of greener cars – namely taxation and the Vehicle Registration Tax (VRT).

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