Tipperary dealers' concern as motor industry at cliff edge over taxation and Brexit

The Motor industry and the motorist is facing the greatest change in taxation since 2009.

The Industry is haunted by the taxation changes in 2009, which undermined both new and used car sales by being too ambitious and seeking to implement change too quickly.

Overnight car values plummeted, new car sales declined and the industry fell off a cliff.

That together with a recession resulted in the closure of 150 family businesses, 14,700 job lost and over €1bn in lost revenue for the Exchequer.

The looming Budget 2020 brings a very concerning feeling of Déjà vu. 

The Society of the Irish Motor Industry (SIMI) continues to highlight the need for extreme caution in dealing with motor related taxation in the upcoming Budget, doubly so now that the Budget almost coincides with the Brexit date.

The economic statement issued by the Minister for Finance Paschal Donohoe  outlined budgetary policy is not a one size fits all, and highlighted the huge difficulty in framing a Budget for next year.

Brian Cooke, SIMI Director General outlines the major concerns facing the Industry

“In this already fragile business environment for car retailers, it is vital that Budget 2020 recognises the importance of new cars; to the economy, in terms of local employment and in terms of tax revenues; and to the environment as the renewal of the Irish car fleet with new vehicles, is the only way to make a material and sustainable move to reducing emissions from the private car. 

“Our industry is very concerned and angry at the possibility of sleepwalking into another potential 2009. 

“The state must stop overburdening new cleaner cars with tax, while at the same time ignoring the problem of replacing older cars, which is where the real emissions problems lie.

“In fact, it’s even worse, the VRT system discriminates against new cars when compared to older used imports. 

“It would appear from various publications that the new car is being lined up as the easy target as if new cars are the main issue. 

“Newer cars have the most up-to-date emission technologies and are less environmentally damaging than older used cars.

“Uncertainty in the market leads to consumers holding onto their older car or importing an older car that is perceived to be good value.

 “With the full move to WLTP emissions testing on the horizon, Budget 2020 must make allowance for the difference between the new and old emission testing systems. 

“Most other EU countries have followed the EU Commission view that consumers should not be faced with increased taxation due to the new emissions testing regime.