Dáil Éireann díospóireacht -
Tuesday, 27 Jun 1995

Vol. 455 No. 1

Written Answers. - Vehicle Registration Tax.

Charles Flanagan

Ceist:

56 Mr. Flanagan asked the Minister for Finance the criteria applied by the Revenue Commissioners in determining the value of used cars presented at points of entry to this State for the purpose of calculating an appropriate level of duty; and if he will make a statement on the matter. [11697/95]

Minister for Finance (Mr. Quinn)

When a used car is registered in the State for the first time, with effect from 1 January 1993, the Finance Act, 1992, as amended, provides that vehicle registration tax (VRT) shall be charged in relation to the car on the basis of a percentage of its value and that value shall be taken to be the open market selling price (OMSP) of the car at the time of the charging of the tax thereon. Determination of these values is based on an ongoing examination of OMSP's of cars in the State. In addition the age, condition, mileage, etc. of each individual car are taken into account, as are any enhancements or extras that may be fitted.

In addition to paying VRT at the time of registering the car, VAT-registered businesses purchasing used cars commercially from other EU member states must also account for VAT on such acquisitions in their VAT returns. VAT in such cases becomes due on the date of issue of the invoice to the registered business and the VAT is assessed on the price charged for the car. However, no VAT is payable on used cars purchased in other EU member states by private individuals for their own use where VAT has already been paid in the other member state.

In cases where used cars are imported into the State from non-EU countries, both VAT and customs duties are payable at the time and place of their importation into the State, in addition to VRT. The criteria used to determine the value for customs purposes are set out in Council Regulation (EEC) No. 2913/92. Under this regulation the primary method used to determine the value is theTransaction Value, i.e. the price actually paid for the used car when it is sold for export to Ireland. An invoice is normally accepted by customs as evidence of the transaction value. Where the value cannot be determined using the transaction value method (for instance where no invoice is available, e.g. gifts) the value is determined by proceeding sequentially through the hierarchy of valuation methods provided in Regulation 2913/92. The cost of transport and insurance of the used car to its place of introduction into the Customs Territory of the EU is added to the value determined by the transaction value method (or other method) to arrive at the value for the calculation of customs duty. The value of the used car for the purpose of assessment of VAT in such cases is the value for customs purposes together with any taxes, duties and other charges levied (excluding VAT and VRT) on the goods.