Car prices - Ministers should ease VRT burden

While it is quite unlikely that the Government will scrap such a lucrative earner as the Vehicle Registration Tax (VRT), it might adopt a more realistic approach to it, and taxation generally on vehicles, to make buying a vehicle more customer friendly.

Currently this year, more than 60,000 Irish motorists have imported cars from abroad in order to avoid very high prices here.

The result is that by doing this they have benefited from substantial savings, in some cases as much as €20,000.

Obviously, people do not purchase a car abroad solely because of VRT. It is just one of the factors which contributes to the high cost of buying one in this country.

VRT in not a tax on cars, despite it being considered a stealth tax by motorists, because that would technically be illegal within a EU context.

While Brussels cannot prevent it being imposed, there are proposals which could see it ended in all EU countries by 2015.

Charges for motor tax are related the size of the vehicle engine, which means the cost of buying one here is outrageously expensive in comparison to other regimes, depending on the preferred model.

Savings can consequently be quite considerable, which is why a seriously high number of people sought to minimise their financial outlay by buying elsewhere, particularly in Britain, the North and even Japan.

The Society of the Irish Motor Industry has called for VRT to be abolished, and although the Government will likely pay little heed, it could exempt from it safety features such as airbags and ABS brakes.