Irish Drivers Association – Giving Irish Drivers A Voice        Irish Drivers Association – Giving Irish Drivers A Voice

Donegal Protest (June 2006)

Dear Taoiseach,

We have written to you on a number of occasions in connection with various motoring issues, NCT, VRT etc.

We have little or no response from the Minister of Transport even though thousands of our members disagree with his judgment and his predecessors.

Members of the Irish Drivers Association will be holding a protest against vehicle registration tax (VRT) on new and second-hand cars at the border of Lifford/Strabane in Co.Donegal on June 20th. 2006 at 1030 a.m. and also at Bridgeend at approximately 2.30 p.m.

The Irish Drivers Association submits that the imposition of VRT is a breach of Article 25 of the Treaty of Rome which abolished customs and excise duties and charges having the equivalent effect as between Member States. Recently the European Commissioner for Customs and Excise expressed concerns to this Government about the imposition of Vehicle registration tax on new and second-hand vehicles and expressed concerns about the excessive levels of taxation on motoring on Irish citizens in this area.

EU Law is superior law to any Member States Constitutional law or domestic law as all member states acceded to a new legal order on joining the European Community.

By referendum. the citizens of this country agreed to become part of the EU which occurred on the 1st. January 1973. Our fathers and forefathers decided this on behalf of the current generation of citizens and for future generations of citizens, our children and our children’s children!

The benefits of the EU Treaty were to be bestowed upon the Irish citizen and all other EU citizens.
Article 25 abolished customs and excise duties in relation to the free movement of Goods. By contrast, since the 1st. January 1973, the current Irish Government and their predecessors have failed in their duty to grant these benefits to the citizens by undermining our Treaty rights by refusing to deliver.

Concern has been expressed at EU level by the EU Commissioner of Customs and Excise and the proposal of a Directive instructing the Irish Government to abolish /phase out VRT over a period of time, 10 years, but the Irish citizen/motorist is asking, requesting and demanding that VRT be immediately abolished and VRT refunded to all citizens who purchased a new vehicle or imported second hand cars where VRT or the customs and excise duty was charged/levied since the 1st. January 1973.

It is incomprehensible and inconceivable that the Irish Government or any Government would circumvent citizens Treaty rights by a circuitous route and effectively implement and retain customs and excise duty on new vehicles etc. under a different name and a different criteria, namely VRT and the first registration of a new car. Denmark has done the same. Customs duties were traditionally charged at the border or the ‘point of entry’. The Irish Government, by imposing VRT, have simply ‘shifted’ the border to a point inside the country and used a different criteria to effectively retain customs duties under a different name and the Government have the audacity and arrogance to call this ‘internal taxation’ which falls within national competence. The effect of this is to ‘retain’ the customs duties whilst at the same time deprive Irish Citizens of their Treaty Rights.

These Treaty rights which resulted and flowed from the holding of a referendum should not be circumvented or undermined by national legislation which in our opinion clearly conflicts with our Treaty rights and such national legislation, which has the effect of depriving us of our Treaty rights and our new ‘heritage’ should itself have been subject to a referendum put to the people to decide whether the Government should be allowed to deprive us of our Treaty benefits by Government ‘retaining’ by another means what Article 25 has abolished. If Governments like Ireland and Denmark are going to be allowed to engage in theses ‘circus stunts’, what was the point in writing the Treaty of Rome or the Constitution if attempts, usually involving money, are going to be employed to deprive us of what we have fought for and participated in a referendum. Where is our democracy if the will of the people is effectively ‘thwarted’ by these means and methods? What is it, that is existing to deprive the citizen of these benefits?

Why would a Governments want to deprive its people and citizens of benefits which were meant to be bestowed upon them and to which they are entitled as a result of participating in a referendum, the decision of which the Government have a duty to uphold and where citizens have a legitimate expectation that they would do so. Thus, is a Government worth preserving if it ‘lies’ to the people or ‘deprives’ them of their Treaty rights by another means?

The Irish Government have stated that the existence of VRT has not impacted negatively on car sales in the state. This has nothing to do with Article 25 of the Treaty of Rome which refers to the abolition of a particular tax. The VRT has  impacted negatively on the disposable income of every citizen who has purchased a new or imported second hand car and creates the false impression that we, as citizens, are happy to pay this VRT and ‘happy’ to be deprived of our Treaty rights. The Government, when tackled by citizens and the EU in relation to the justification of the imposition of this ‘unlawful’ tax have nearly always pleaded ‘the poor mouth’ and ‘where are we going to get €1.5 Billion from? First of all, the Governments were no longer entitled to this money as a result of acceding to the EU in 1973 and secondly we are being told by this Government for the past 10 to 12 years that ‘The Celtic Tiger is Roaring’. It is roaring all right, from out of the citizen’s pockets and into the Department of Finance. Presumably, of course, what the Department of Finance are implying is that there is no adverse impact on trade or restriction of movement of goods as a result of VRT. Actually, there is. We will not buy a new car because of VRT and many people we know, and many of our members, feel the same way. In fact we want our VRT returned to us and to all citizens because it is unlawful under the Treaty and ‘the system’ is actually perpetrating fraud and deception on the Irish Citizen. How much tax do the Government want on a new car? How much is enough?

Consider the benefits which flow from abolishing VRT. New cars would be cheaper by approximately 30%. Higher volumes of sales would be generated and the Government would probably take in, in VAT, pretty much the same as it is getting now. Road safety would be enhanced because citizens are now able to drive more modern and safer cars, which is likely to substantially reduce the incidence of road deaths, lower insurance premiums etc.

Finally, what are the legitimate choices used by the Irish Government to justify this VRT. The objective criteria in our view are based on the first registration of a new car. What objective criteria is this and what other criteria were available to the Government to make comparison to? The reality is, new cars are approximately 30% more expensive in Ireland than in any other EU Member State. VRT seems a lot of money to pay for a rectangular piece of plastic with numbers and letters on it does it not? If we purchase a new car in Holland, Germany or France and ‘import’ it into Ireland to be levied with a massive tax of VAT and VRT, is not the effect of this to discourage a citizen from going to another Member State and obtain Goods? How is this not affecting the free movement of goods? Under the free movement of workers, this amounts to discrimination against the individual and acts as a barrier to the free movement of persons. Is it not also the case in relation to the free movement of goods if we are discouraged from going to another Member State, the imposition of VRT effectively discourages me from doing so, or at the very least, has the potential of discouraging us? Why must the Irish pay more for their vehicles? Why are these opportunities not being explored?

Why are the benefits of cheaper vehicles, increased road safety and cheaper or potentially cheaper insurance premiums not being given to the Irish Citizen? All it seems to us is that the Government are giving ‘excuses’  to justify ‘ripping-off’ the Irish Citizen and it is rapidly reaching the point that it is no longer going to be tolerated, the effect of which is treating the Irish Citizen with impunity.

The VRT is a charge having the equivalent effect of a customs duty. It is unlawful in its nature, application and implementation. The Irish Drivers Association are therefore calling on the Government to abolish it and refund to Irish citizens, all VRT/Customs duties inflicted on Irish Citizens since the 1st.January 1973.

Even if VRT is deemed to be ‘legal’, why does the Government want 2 taxes on a new vehicle, namely VRT and VAT?

Even if both these taxes were ‘legitimate’ why are the two taxes applied cumulatively and not separately? The effect of applying the taxes cumulatively is to create ‘invisible’ money by a mathematical ‘circus stunt’ calculation presumably ‘invented’ by a civil servant in the Department of Finance using ‘creative economics’. For example, the VAT is applied after the VRT has been applied to the ‘base price’ of a car. By applying them cumulatively, the effect is to create more money than if they were applied separately. For example, a €10,000 car base price, apply VRT at 25 %(under 2 litres capacity) now makes the car €12,500. Apply 21% VAT on the 12,500 makes the retail price €15,125. Total tax take €5125. By contrast, applying the rates of 25% VRT and 21% VAT separately to the €10,000 ‘base price’ creates taxes of €2500 and €2100 respectively, total taxes €4600 making the retail price €14600 to the citizen. The Government have it for sale at €15,125. Where did the difference of €525 come from? It came from the ‘creative’ mathematical ‘circus-stunt’ designed to deceive the citizen. On a €20,000 vehicle, this ‘invisible’ money which a citizen has to pay in ‘reality’ rises to €1050 and in the case of a €30,000 car, it rises to €1575. The Government then use a ‘scrappage’ scheme to induce you to scrap your car if it is over 10 years old and say they will give you £1000IR (at that time) for it if you purchase a new car when in reality a citizen is actually paying for the scrappage scheme himself/herself whilst it costs the Government nothing as a result of applying the combined taxes cumulatively. For example, 25% + 21% = 46%, but our Government would have you believe that this 46% is not 46% at all. It is €15,125 divided by €10,000 = 51.25%. By mathematical ‘circus-stunts’, the Irish citizen is deceived and ‘frauded’ by the Government. Do you believe that 46% is actually 51.25% or do you believe 46% means 46%? If  a citizen is charged in excess of 46%, then the citizen is being ‘frauded’ and you are implementing this ‘system’ as a means of ‘deception’ in the same way that s.1 of the 1952 Finance Act (Excise Duty) states that a quarter shall mean ‘not exceeding 30%’. We always thought  that a quarter of anything in terms of percentage, was 25%, but the statement in s.1 of the 1952 Act ( an Act of the Oireachtas) has stated something which is not so. The Government have effectively stated the thing which is not. The reality is that 3 months road tax equates not to 25% of 12 months but 28.1% of the annual road tax premium. What is the meaning of this? The Government are doing the same with the cumulative application of VRT and VAT to new vehicles. And why was it necessary for the Government in s.1 of the 1952 Act to refer to a fraction at the start of the sentence and finish the section with reference to a percentage? Was this designed as another means of deliberately confusing the Irish Citizen?
You are ‘invited’ to participate with members of the Irish Drivers Association and have your say. Lobby your local TD’s and MEP’s. Demand reasons from them and make them accountable for the reasons why citizens are being deprived of their Treaty rights and why national legislation was implemented to effectively deprive citizens of their Treaty rights.  Eddie Hobbs produced 4 programmes on ‘Rip-Off Ireland’ presented on RTE, which we are aware ‘embarrassed’ the Government. However, the Irish Citizen has only been saying for at least the past 50 years if not longer, the same things that Eddie Hobbs has been saying and the Government have not listened to the citizen. Now, make your voice heard and your feelings known. Remember, true sovereignty lies with the citizen and the people, not with the Government. It starts with you. Fight for your rights and do not allow the Government to deprive you of them. Do not allow Customs, Revenue or the Gardai to dispossess citizens of their vehicle for these are interfering with citizen’s Constitutional rights to the peaceful enjoyment of your possessions, interferes with you EC Law rights to the freedom of movement under Article 39, interferes with your EC Law rights to the freedom to provide services under Article 49 and breaches the important EU Law principle of proportionality which states that the institutions of the State can only take action in proportion to taxes that are owed and thus cannot dispossess a citizen of their cars/vehicles if say €2000 are owed in VRT and one’s car is valued at €10,000.

Thank you for your attention and we look forward to seeing you on June 20th. Help us in our endeavours to accelerate the cause to abolish VRT, refund these monies and alleviate the unfairness in these ‘systems’ and to restore our Treaty rights. Thank you all, so much, for your support.

For Further Information, Contact:

John Doherty, Chairman, Donegal Branch, on 086 878 9925
David Russell,  National Secretary, on 087 231 2250
John Lernihan, National Chairman, on 087 250 9123.

E&OE.