Wednesday, 2 July 2014

Questions (72)

Michael Healy-Rae


72. Deputy Michael Healy-Rae asked the Minister for Finance the position regarding a car scrappage scheme (details supplied). [28738/14]

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Written answers (Question to Finance)

The Deputy has previously raised the question of whether I would introduce a car 'swappage scheme', which SIMI proposed in their 2014 pre-Budget submissions. The proposal was considered at the time but given budgetary constraints was not proceeded with.

In respect of a car scrappage scheme, the Deputy will be aware that a scheme of that nature was previously in place from January 2010 to June 2011. Under that scheme, Vehicle Registration Tax (VRT) relief of up to €1,500 was provided where a car of 10 years or older was scrapped and a new car of CO2 emissions bands A or B purchased between January 2010 and December 2010, with reduced VRT relief of €1,250 in place between January 2011 and June 2011.

Any proposals that could potentially boost economic activity will be considered in the context of Budget 2015. However, I would point out that as the most recent car scrappage scheme ended only three years ago, I would be mindful of the potential deadweight cost associated with introducing a new scheme so soon after the previous scheme ended.

The Deputy may be aware that motor car sales figures for the first five months of this year have been over 24.5% higher than the same period in 2013, suggesting the motor trade is showing signs of recovery.