asked the Minister for Finance if he will show how the various taxes levied on the importation of a vehicle are calculated in examples (details supplied).
Written Answers. - Taxes on Vehicles.
43.
In the examples given it is assumed that the Deputy is referring to vehicles imported from another EC country. Customs duty may also be payable on vehicles imported from non-EC countries. The reference in the details supplied by the Deputy to CIF price is taken to mean a reference to the import value for Customs purposes.
The information requested is as follows:
(a) New vehicle, with an import value of £3,500, whether imported by a main distributor or a private person:
Excise Duty (assuming a recommended retail sale price for the vehicle in the State of £10,000 and that the engine capacity is not more than 2012 c.c.) = 21.7% of £10,000 = £2,170 VAT on importation — 25% of the sum of the import value and the excise duty (viz. £5,670) = £1,417.50; Total = £3,587.50. Additional VAT would be payable on subsequent sale transactions in the State by a trader.
(b) Secondhand standard model Mercedes 200 motor car. (Assumed to have been first registered in mid-1982): (1) imported by a main distributor with an import value of £6,087 (assumed to have been bought net of VAT) — Excise duty — 21.7 per cent of the current recommended retail sale price (viz. £27,425) less 60 per cent depreciation = £2,380.49; VAT on importation [calculated as in example (a)] = £2,116.87; Total = £4,497.36.
Additional VAT would be payable on subsequent sale transactions in the State by a trader.
(2) With an import value of £7,000 which includes residual VAT of £913, imported by a private person. (It is assumed that the Deputy has in mind a person entitled to VAT relief under the terms of the European Court of Justice decisions 15/81 and 47/84. Under the terms of those decisions, a secondhand motor vehicle acquired from a person in another member state of the EEC who is not entitled under the VAT laws of that state to deduction or refund of the tax thereon, may qualify for credit at importation in respect of the residual part of the last value-added tax paid in the exporting member state which is still contained in the value of the vehicle at importation. The grant of such credit is subject to production, by the importer, of adequate documentary proof (i.e. original invoice or a copy thereof) showing the last levy of VAT on the vehicle in the member state of exportation. The amount of credit, if allowable, may not exceed the original VAT paid. The amount allowable is deductible (a) from the value at importation for VAT purposes and (b) from the actual charge to VAT at importation) — Excise duty [as in example (b) (1)] = £2,380.49; VAT (see calculation below) = £1,203.87; Total = £3,584.36.
Calculation of VAT in example (b) (2) Import Value = £7,000; Less residual VAT content, (£913) = £6,087; Excise duty [as in example (b) (1)] = £2,380.49; Value for VAT purposes = £8,467.49; VAT @ 25% = £2,116.87; Deduct residual VAT = £913; Net VAT payable = £1,203.87.