Car registration and road taxes should be dovetailed into a single levy in the European Union, the European Commission proposed today.
The EU executive approved draft legislation that will now go before member states and the European Parliament.
“The proposal aims to improve the functioning of the Internal Market by removing existing tax obstacles to the transfer of passenger cars from one Member State to another,” a Commission statement said.
Drivers would no longer face double taxation when moving country within the 25-nation EU if the legislation is adopted, and part of the charge would be related to how much the vehicle pollutes
The Government nets €800 million per annum from vehicle registration tax (VRT).
The tax adds between 22 and 30 per cent on to the purchase price of cars in Ireland, even before VAT of 21 per cent is added.