Dáil Éireann Debate, Thursday - 29 September 2022
109. Deputy Richard O'Donoghue asked the Minister for Finance if discussions are expected to amend the current vehicle registration and custom duties applicable to the importation of used vehicles from Great Britain, including those with European Union or third-country origin, due to the record low number of vehicles in the car fleet industry; and if he will make a statement on the matter. [47740/22]
View answerAll vehicles in the State must be registered here, and Vehicle Registration Tax (VRT) is generally payable when a vehicle is being registered. For passenger cars, the amount of VRT is based on the vehicle’s value and its CO2 and NOx emissions. The VRT calculation is not affected by whether the vehicle has been imported, or by the place of origin of the vehicle.
Since the withdrawal of the UK from the European Union, an import of a vehicle from Great Britain is treated as an import from a third country, i.e. a non-EU country. If a vehicle is imported from Great Britain into Ireland, the importer is required to complete a customs declaration and pay customs duty, if applicable, and VAT at 23%, prior to presenting the vehicle for registration.
Under EU customs law, VAT at import is chargeable on the customs value of the goods. The Customs value consists of the purchase price, plus the cost of transport and insurance, any handling charges and the Customs duty amount payable on the vehicle. Where it can be proved that a vehicle was owned and operated from Northern Ireland prior to Brexit, or has been imported inclusive of a VAT payment in Northern Ireland after that date, VAT is not due unless the vehicle is determined to be a New Means of Transport.
Customs is an EU competence and applies in all Member States, and it is not possible for me, as Minister for Finance, to implement any measures or suspend any measures that are not in compliance with EU Customs legislation. The EU-UK Trade and Cooperation Agreement (TCA), eliminated tariff duties for trade between the EU and Great Britain where the relevant rules of origin are met. If the vehicles are of UK origin, then a 0% tariff rate applies. Tariffs of 10% will apply to vehicles which are not of UK origin. However, in certain instances Returned Goods Relief may apply. This relief applies where the vehicles were originally exported from the EU, have not been altered and are re-imported within three years of export from the EU. In very specific circumstances, relief from Value-Added Tax (VAT) may also apply where the goods are re-imported into the EU by the same economic entity that originally exported the goods out of the EU. Further information on Return Goods Relief is available on the Revenue website at www.revenue.ie/en/customs-traders-and-agents/relief-from-customs-duty-and-vat/goods-reimported-into-the-european-union/index.aspx
Where Returned Goods Relief does not apply, the following vehicles imported from GB will have tariffs applied as they will not qualify as UK origin under the rules of origin set out in the TCA:
- vehicles of EU origin used in the UK
- vehicles of other third country origin used in the UK. This applies even if the EU has a Free Trade Agreement with the relevant third country such as Japan.
See the table below for further information on Customs Duty and VAT payable depending on the origin of vehicles imported from GB.
|
Customs Duty and VAT payable |
||
|
Origin of vehicle |
Customs Duty payable |
VAT payable Customs Duty and VAT payable |
|
UK Origin of vehicle |
0% Customs Duty payable |
23% VAT payable |
|
Third country (such as the USA or Japan) UK |
10% 0% |
23% 23% |
|
EU (such as Germany or France) Third country (such as the USA or Japan) |
10% 10% |
23% 23% |
Additional information can be found on the Revenue website at the following link: revenue.ie/en/importing-vehicles-duty-free-allowances/guide-to-vrt/registration-of-imported-used-vehicles/index.aspx.
It is important to note that the preferential tariff treatment or Returned Goods Relief must be claimed on import on the Customs declaration. Details on how to do this are available on the Revenue website at the following links: www.revenue.ie/en/customs-traders-and-agents/customs-electronic-systems/aep/ecustoms-notifications/2021/ecustoms-notification-04-2021.pdf and www.revenue.ie/en/customs-traders-and-agents/documents/returned-goods-relief-movement-vehicles.pdf .
