Motor tax system punishing people on low incomes and with older cars – Mulherin

Fine Gael Mayo Senator, Michelle Mulherin, has said that the motor tax system is not fit for purpose. Speaking in the Seanad recently, Senator Mulherin said that people paying motor tax in instalments should not be forced to pay more.

“The current motor tax system discriminates against those on low incomes, or whose personal finances are stretched.

“People who are renewing their motor tax and wish to pay by instalments, which those on a tight budget often wish to do, end up paying more over the course of the year than they would if they paid in one lump sum. It is obvious that, unless someone is leaving the country or not using the vehicle anymore, most people are paying it in instalments due to the financial pressures they are under.

“I was recently speaking to someone who had the option of paying their motor tax on a three-monthly, a six-monthly or a 12-monthly basis. They pay it on a three-monthly basis and, therefore, end up paying €170 more than they would if they paid for the year, an amount that they cannot afford to pay up front in one go.

“Another issue is the significant big disparity between the amount of motor tax paid on vehicles registered after July 2008 and those registered before that, even concerning vehicles with the same engine size. A person might pay €180 to tax a 1.6 litre vehicle registered post July 2008, while another person could pay up to €500 for a vehicle registered before this date. I know the rationale is to encourage people to buy vehicles with lower emissions, however in reality, it requires people to buy newer vehicles, and not everyone can afford to do so. People with older vehicles are shouldering this cost even if they might not be using the road as much as someone with a newer vehicle.

“The motor tax system needs to be changed in order to ensure that people on lower incomes, and those driving older vehicles, are not punished unnecessarily. The forthcoming budget is an opportunity for the Minister for Finance, in conjunction with the Minister for Environment and Local Government and the Minister for Transport to introduce these changes and I am calling on them to do so.”