A review of carbon banding for both motor tax and Vehicle Registration Tax (VRT), which included a public consultation process, was carried out in 2012. Following the review, a new structure was introduced from 01 January 2013, with CO 2 Band A being broken into four separate bands and B band being split into two for both motor tax and VRT. For motor tax only, a new zero band has been introduced for electric vehicles with a lower annual tax of €120 applying.
The revised banding recognises that ever more fuel efficient cars are becoming available and allows for the differentiation of the environmental incentive in favour of the most environmentally friendly vehicles, whilst also allowing for the protection of the tax base.
While the operation of the motor tax system is kept under regular review, I have no plans at present for any further restructuring of motor tax for private vehicles.