Dáil Éireann Debate, Tuesday - 12 July 2022
283. Deputy Aindrias Moynihan asked the Minister for Transport the reason that persons who pay their car tax on time each quarter are charged more than if they pay annually; if he will review the situation; the cost per transaction to issue vehicle tax certificate; and if he will make a statement on the matter. [37722/22]
View answerMotor tax can be paid annually, half-yearly or quarterly. Half-yearly or quarterly renewals involve additional costs to process and administer. The rate for the half-yearly option is 55.5% of the annual rate, and, for the quarterly option, 28.25% of the annual rate. These ratios have remained generally consistent since the 1960s. The loss of income from equalising rates for these options would have a negative impact on motor tax revenue and would have to be borne elsewhere in the motor tax system or in the taxation system generally. The potential loss to the Exchequer has been estimated at just over €37m, based on the volume of transactions in 2021. Given the sum involved, any proposed change is a matter for consideration in the context of Budget preparations.
The current cost per transaction in issuing a motor tax disc has not been established. Any such costing exercise would have to factor in the indirect costs of running local motor tax offices, as well as the Driver and Vehicle Computer Services Division of my Department, which is responsible for the maintenance of the National Vehicle and Driver File (NVDF), the central vehicle database, as well as supporting systems in motor tax offices. The Department of Housing publishes the Amalgamated Audited Annual Financial Statement for all the local authorities on an annual basis. The most recently published Statement is for 2019 and gives the total cost of running the local authority motor tax service at €29.4m for the year. The annual cost of running the NVDF is currently some €22.9m, excluding staff costs. However, the NVDF also supports road traffic enforcement, vehicle testing and the road transport operator licensing system and the allocation of overheads across each of these functions, as well as the provision of the motor tax service, cannot be easily ascertained.
