The unfair tax system for cars

HELPDESK: From M Kenna, Dublin 16: Am I alone in my anger at the inequity that the current motor tax regime displays? My road tax renewal falls due shortly when I will be obliged to pay €823 in respect of my almost 10 year-old diesel 2.1-litre vehicle. But if I purchased the latest model of the car, my yearly road tax would be €447. Even if my older car fell into the emissions tax system, the tax would be €630, almost €200 less than I am now obliged to pay.

Contrast this with the situation in the UK where CO2 emissions applies from March 1st 2001 and where cars in the 176 - 185 g/km range are charged £200 annually. All cars registered before the above date are subject to only two rates, the higher being £205. Ironically new cars purchased in 2010 in the 176-185 g/km range bear a first year tax of £300, in order to penalise the purchasers of higher emission vehicles or at least discourage them. Would that I could be punished accordingly.

Used car buyers are increasingly the victims of the emissions race and I suspect their ire is only going to grow. In the coming years many new car emission levels will fall below 140g/km. In turn tax rates may well start lower down the emissions scale as the Government tries to protect its revenue. Such a change would mean cars that were “green low emission vehicles” compared to rivals when they were launched, would lose their tax benefits compared to newer models.

All this will undoubtedly impact on used car prices as well. Buyers will choose between a used car that comes with a hefty annual tax charge, or financing a new car that might cost more up front but could save them up to €600 a year in motor tax. For those who can’t afford a new car, they will face a tax penalty every year.

Send your queries to Motors Helpdesk, The Irish Times, Tara St, Dublin 2 or email motorshelpdesk@irishtimes.com