I welcome the Minister of State at the Department of the Environment, Heritage and Local Government, Deputy Gallagher, and apologise for not having been able to raise the following point, which is germane to this section, on Second Stage. I had other commitments and could not be here. It is an issue which cannot be rectified at this point but which I would like the Minister of State to urgently draw to the attention of the Minister for Finance, Deputy McCreevy, namely, the anomalous and unfair situation regarding older cars. I immediately declare a personal interest, but there is a principle involved. I have a fine motoring car, a Jaguar XJ6.
Motor Vehicle (Duties and Licences) Bill 2004: Committee and Remaining Stages.
A beautiful car.
It cost me €5,000 because it was ten years old when I got it two years ago. I have to pay approximately €1,300 in tax. That seems iniquitous. From a conservation point of view, people should be encouraged to retain older cars like that — good quality cars — which have not exhausted their usefulness. The taxation should, in some measure at least, be related to the value of the car. If one looks at other forms of taxation, one is taxed relative to value. I am taxed on my income. If I have an income of €100,000, I go into a particular tax bracket because I have X amount of money. In the old days, if I had a house which was over a certain value, I would be taxed on it. That principle goes right through the whole tax system.
It is ludicrous that I and many other people in this situation are approaching a point where we pay more in tax than the market value of the car. That is absurd. I remember the give away budgets in which Fianna Fáil romped home because it did things like abolish car tax. However, it gradually crept back until we now have this absurd situation of these huge amounts of tax on cars which are not commercially valuable. That is wrong.
The French Government addressed this situation sensibly in the past couple of years. When this anomaly was drawn to its attention, it removed tax completely from cars and replaced it with one cent on petrol. That has the great advantage of minimising all the bureaucratic inconvenience, the muddle, the prosecutions, the delays, the Civil Service administration and so on. I could not table an amendment because, as the Minister of State knows, the Seanad is not trusted with the purse strings of the State. If I table an amendment which costs money, it will be immediately ruled of out order because of the way the Seanad has been established. I urge the Minister for Finance to look at this issue.
I will be cynical and say that by the time of the next election, this could be a popular issue. The Minister might meet resistance from people who want to sell new cars but there is also a substantial body in the motor industry which sells second-hand cars. Rather than litter the countryside with the corpses of perfectly useable cars, the Minister would make it financially possible for people to continue to drive them.
I raise this issue because I have raised others in this manner with the Minister for Finance, Deputy McCreevy, and have found him to be open-minded. If he does not agree, he will kick it out the window but if he thinks there is the slightest bit of sense or, as Sean O'Casey would say, tither of wit in it, he will look at it. That is all I ask. My proposal would save on wastage, scrappage and so on. It would also mean there was a little more rationale to the way tax is levied on cars. It should be related to age or it should be abolished altogether which would be popular, would minimise bureaucracy, would free up some of these civil servants who the Minister could then ask to go wherever he liked. They could be decentralised all over the place.
The Minister for Finance has, or his predecessors have, in effect, already conceded this principle. There is provision for antique or classic cars; owners of cars in excess of 30 years old pay a marginal, notional tax. However, some of us cannot wait that long. I ask the Minister to consider this issue and I thank the Acting Chairman for allowing me to make this point.
The Senator will know that a car's cc, not its age, is the basis for taxation. On the principle about which he speaks, section 4 provides for new rates of motor tax for motorcycles and other vintage vehicles over 30 years old. I do not think anyone would describe a 12 year old Jaguar XJ6 as such. With the Senator living in the fast lane, I presume it is possibly 3000 cc. Of course, he cannot identify with many people in Ireland as far as cars are concerned because 60% of the national fleet is made up of cars under 1400 cc. He is among an elite group.
I appreciate the point the Senator makes but I reiterate we are talking about 5% across the board. I do not believe he is complaining about the minor increase of 5% resulting in €34 million in additional funds for the country roads. The Senator will be as familiar with rural Ireland as he is with Dublin and the necessity to maintain record investment. I will bring the case he has made to the attention of the Minister for Finance but, in the meantime, a proposal to assess motor tax on the basis of CO2 emissions is under consideration. However, this cannot be done overnight and we want to be fair and balanced in this regard. For example, the Senator's car or an older car with a 1000 cc engine might generate more emissions than a modern 3000 cc car because of the advances that have been made. We are examining this proposal and there will be further discussions on it.
It is paramount to ensure CO2 emissions are minimised over the next number of years given that national and international obligations must be met in this regard. Motor tax on cars with an engine capacity of more than 1400 cc and more than 3001 cc will increase by €64 per year, which equates to slightly more than €1 per week. Senator Norris is interested in the environment and vintage cars and his motive for making the proposal is more than financial. I will discuss his proposal with the Minister and perhaps we will have further discussions at an appropriate time.
I thank the Minister of State.
The hikes of 12% last year and 5% this year in motor taxation were discussed in detail on Second Stage. However, the millions of euro lost through people failing to pay motor tax must be addressed. The Government needs to get tough on motor tax dodgers. A survey published a number of years ago highlighted that the Exchequer loses millions annually and it is unfair on people who pay their taxes. This issue must be examined because it has resulted in inequity. A number of those who evade motor tax are also cheeky when they are on the road. Tough legislation must be introduced to deal with those dodgers and I would like the Minister of State to comment on this aspect. The penalties should be stiffer for those who evade motor tax and they should be imprisoned if they do not comply with the law.
A related issue is the facility provided to motorists whereby they can skip the payment of motor tax for two to three months and then call to their local Garda station to have a declaration signed that the car had not been on a public road during that time. This should be addressed because local authorities lose significant moneys annually as a result of non-compliance with motor tax regulations. I would appreciate it if the Minister of State would examine this issue in detail in the not too distant future.
A number of people think they should not pay taxes, no matter what tax is involved. Senator Bannon referred to declarations signed in Garda stations. When a declaration is signed that a car has been off the road, the garda witnesses the signature of the car owner and, therefore, he or she makes the declaration, not the garda. Penalties are in place to deal with car owners who knowingly enter a Garda station and make a dishonest declaration.
I understand the law in that regard. Such people are guilty of making two false declarations. First, they have the cheek to go into a Garda station and declare the car is off the road and then they sign a declaration form in the presence of a garda. That is wrong and that law needs to be examined. It is unfair to the gardaí who sign the forms because they cannot be on everyone's back on a daily basis. The Garda is under resourced.
I have received representations regarding the number people using the motor tax renewal form to declare their cars have been off the road. The Minister of State's officials should also examine the insurance implications of such declarations. If a motorist's car is off the road for three or six months, he will cancel his insurance. Gardaí should double check whether such motorists have insurance, never mind tax. There is a loophole in this regard, which needs to be addressed by the relevant Minister or body. This is a widespread problem.
I very much appreciate the issues raised by all Senators who are totally realistic about motor tax. Taxes must be paid, even if we do not agree with them. If they are levied, everybody should pay them. A greater burden is placed on those who pay by those who are not tax compliant.
The last survey of compliance with motor tax and motor insurance law and national car testing schemes was carried out in June 2001. The survey highlighted that, typically, approximately 4.6% of vehicle owners persistently evade motor tax compared to 2.8% in the previous survey five years earlier. This represented a loss of approximately €30 million in motor tax receipts in 2003. This loss will increase by 5%, or €1.5 million, this year if the same evasion rate pertains.
The British motor tax evasion rate is 4.5% according to a survey carried out in 2002. Enforcement and prosecution for non-payment of motor tax is a matter for the Garda and details of the number of prosecutions are provided annually in the Garda Commissioner's report on crime. Under powers to tackle motor tax evasion introduced in April 1995, the Garda may impound vehicles in respect of which motor tax has not been paid for a continuous period of three months or more. Following the publication of the nationwide survey of compliance with motor tax, the Garda Commissioner undertook to implement a number of measures such as the revision of existing enforcement initiatives and also the drawing up of comprehensive regional enforcement plans. The Commissioner has been requested to ensure the Garda policing plan maintains and expands on this enforcement action to vigorously pursue evasion.
The evasion of motor tax is an offence and the funds raised through the tax are important to the development of a safe, good quality, non-national road network. As a result of the enactment of the legislation, an additional €34 million will be generated.
Another €30 million on top of that would go a long way towards achieving the profile we have established for ourselves in the south and east and in the BMW regions. I hope, in the very near future, that officials of my Department who deal with tax will meet with officials from the Garda Commissioner's office to discuss how we can work together to address this issue and to ensure that we achieve the objective of almost 100% compliance. There is a duty on every individual to pay motor tax. We will be anxious to reduce the rate of non-compliance from 4.6% to a much lower rate. I do not think a zero rate is achievable but we will reduce the rate to as near zero as possible.
I thank the Minister of State for bringing this Bill to the House and for dealing with the issues raised by Senators. Although the Bill relates to motor taxation rates and trade plate licences we had a wide ranging debate on roads, signage, road safety and public transport. I thank the Minister of State for responding to the issues raised.
I am glad the Bill has been passed and I look forward to welcoming the Minister of State to the House soon again.
I too would like to thank the Minister of State and his officials for dealing with this Bill over the past two days. The Minister of State has spent a considerable amount of time in the House recently and that is appreciated. I may not agree with all of what he says but we are here to legislate and we have completed a legislative task. I add my words of acknowledgement to the Minister of State and to his officials.
I thank the Minister of State and his officials for introducing the Bill. I welcome his announcement that he will look at the CO2 emissions from vehicles and of the future review of the system. That is also to be welcomed.
I thank the Minister of State. We have had disagreements during the debate on the Bill. It is a little rich to expect people to pay extra taxes when we do not crack down on tax evaders. I am delighted the Minister of State has indicated that he will do all in his power to crack down on tax evaders. Law which allows people to evade paying tax is bad law.
I thank the Minister of State for coming to the Seanad and I hope to see legislation in the not too distant future to provide for all road users. We have passed the Motor Vehicle (Duties and Licences) Bill but other road users, such as cyclists and pedestrians, must be catered for. I hope they will be facilitated in a future Bill.
Ba mhaith liom mo bhuíochas a chur in iúl dos na Seanadóirí, go háirithedóibh siúd a ghlac páirt ghníomhach san díospóireacht thábhachtach seo ar An mBille um Mótarfheithiclí (Dleachtanna agus Ceadúnais) 2004. Tá an Bille seo fíor thábhachtach ó thaobh na mbóithre nach bóithre náisiúnta iad ós rud é go mbeidh níos mó ná €34 milliún breise ag an Roinn agus ag na húdaráis áitiúla tríd an tír chun caitheamh ar bhóithre nach bóithre náisiúnta iad.
Beimid ag leanacht ar aghaidh an bhliain seo chugainn agus ina dhiaidh sin, ag cur an airgid go léir atá ag teacht ó na ceadúnais seo isteach sa chiste seo fá choinne na mbóithre. Ní hé sin ant-aon airgead a bheidh le fáil. Tá an Stát, taobh amuigh de sin, ag cur airgid ar fáil chomh maith. Táimid iontach bródúil as an méid atá á chur ar fáil i mbliana agus le blianta beaga anuas go dtí seo.
Gabhaim mo bhuíochas arís leis na Seanadóirí a ghlac páirt ins an díospóireacht. Tá súil agam go mbeidh deis againn go luath chun castáil le Coimisinéir an Gharda Síochána maidir leis na daoine nach bhfuil sásta cáin gluaisteáin a íoc. Caithfear brú a chur ar an 4.5% de dhaoine nach n-íocann an cháin. Caithfimid an figiúr sin a laghdú. Má laghdófar é b'fhiú na milliúin euro breise don chiste dá bharr. Cuideoidh sé sin lenár bpleananna chun na bóithre nach bóithre náisiúnta iad a fhorbairt ins na blianta atá amach romhainn.