13 September 2002: The European Commission’s call this week for the phasing out of car registration taxes has been welcomed by the boss of Ford in Ireland, Eddie Murphy. But he is gloomy about the chance of a quick change to the inequitable situation in this country.

In a statement today, he says "Taxation of Passenger Cars in the European Union" can be the basis for ‘constructive discussion’ on vehicle registration tax, a ‘longstanding bug bear’ of the industry in Ireland.

“The Irish motorist has suffered from one of highest rates of this inequitable tax for too long,” he says. "Whatever the ultimate solution, it must embrace the principle of tax harmonisation. The Irish consumer deserves to be treated equally to his or her European counterpart. Implicit in the paper is not a reduction in motor taxation per se but a shift to taxation based on criteria such as emissions and usage. We have long advocated a more enlightened form of taxation than the blunt mechanism of VRT, but it needs to be line with our European partners.”

VRT was introduced in the early 90s to directly counteract the abolition of excise duty. At the time the then Finance Minister Bertie Ahern inferred this new tax would be whittled away by the end of the 90s, yet it has actually risen in the interim.

"An uneven playing field in car taxation - in whatever form - deprives both the Irish motorist and the motor industry here of the benefits of the Single Market,” Mr Murphy says. "As a discussion document, we would anticipate lengthy negotiations between member states before its recommendation could take effect. Even with this, a transition period of up to ten years is referred to. If the crippled Irish motorist is to benefit from this paper, it will not, it would appear, be for some time to come."