Ford urge a green approach to car tax

CAR manufacturers Ford last night called for radical changes to the motor taxation system to help protect the environment.

Ford Europe chief Martin Leach urged the Government to consider a green approach to car tax that's linked to emissions.

At the moment vehicle registration tax (VRT) is charged according to engine size.

This system doesn't help create a cleaner environment, Mr Leach said in Cork last night.

VRT begins at 22.5% on cars below 1400cc and rises to 30% for larger engines but Mr Leach wants new tax bands introduced. These bands should link tax levies and emissions, he said.

"After all, this is where efforts in R&D are aimed not at producing cars with smaller engines, but cleaner cars, with lower emissions," Mr Leach said.

The Ford Europe boss also criticised changes announced in last year's budget that upped VRT on cars between 1900cc and 2000cc to 30%.

"Most diesel cars have 1999cc engines and the tax hike will discourage sales of these cleaner engines," he said.

He said VRT is leading to very high car costs here and motors should not be viewed as luxury items by the Government.

"We talk a lot about car prices. For price harmonisation to be a reality in Europe, a common currency, a common tax regime and a common regulatory environment are prerequisites," he said.

Mr Leach said that demand for new cars has dropped this year and consumer confidence is also suffering.

Mr Leach was the guest of the Cork Chamber of Commerce at a reception to mark the 100th anniversary of the Ford Motor Company established by Henry Ford.

Henry's father, William Ford, left the village of Ballinascarty in Cork for the US in 1847.