Motor Tax: Motor tax is to be increased by 5 per cent from January 1st, the Minister for the Environment, Mr Cullen, announced yesterday. Denying that this was another "stealth tax", he pledged that "every cent and more" of the increase would be invested in improvements to county and regional roads.
Motorists with one-litre cars will see their motor tax rise by €7 to €151 per year, while those with 1.4-litre cars will be charged an extra €14, bringing their outlay to €292 per year. The corresponding increases for larger cars would be as follows: 1.8-litre, €24 per year; 2-litre €26; 2.5-litre €46; and 3-litre €64. This reflects the fact that motor tax is levied progressively, based on engine capacity.
"For the majority of drivers, the increase means an extra 27 cents a week," the Minister said. "This is a very fair increase to maintain and improve our non-national roads."
He emphasised that all motor taxation is paid directly into the Local Government Fund, which was ring-fenced in law and could not be used by the Exchequer for other purposes.
"We need quality roads and this requires money," he said. It is estimated that the latest rise in motor tax, which follows a 12 per cent increase this year, will bring in an additional €34 million for the non-national roads programme in 2004.
