No motor tax refunds for vehicles off road during lockdown

State collected more than €362 million from motor tax during height of pandemic

The M50 motorway in Dublin in March, during the lockdown. Photograph: Tom Honan

The M50 motorway in Dublin in March, during the lockdown. Photograph: Tom Honan

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The Government will not offer motor tax refunds to drivers who kept their vehicles off the road for months during the height of the Covid-19 lockdown, Minister for Transport Eamon Ryan has said.

More than €362 million in motor tax, some €294.5 million of it from private vehicles, was taken in by the State in the period from March 1st to July 16th, including during the most intense period of restrictions when virtually all bar essential vehicles were off the road.

But the Minister said the motor tax receipts “are a significant contributor to exchequer finances and form part of the means of ensuring that Covid-19 supports can continue in the short term” and for the ongoing provision of public services.

Social Democrats joint leader Catherine Murphy said, however, that some concession should be made to drivers given their adherence to the public health advice.

The Kildare North TD pointed out that “even insurances companies offered some refunds”.

“They were relatively small amounts but an acknowledgement that drivers stayed off the road,” she said. “There was far less traffic and consequently fewer accidents and that had to be considered.”

Insurance rebates

The government put motor insurance companies under pressure to provide some relief to drivers given the profits the sector enjoyed last year. A majority of companies agreed to a call by Minister for Finance Paschal Donohoe for a concession, with reports of rebates between €25 and €33.

Some companies said the expected fall in claims would be reflected in lower premiums when customers renewed.

Ms Murphy said constituents had contacted her asking what the Government was going to do about motor tax refunds and suggested the State could at least consider specific cohorts for a refund.

“The over-70s would be an obvious category when they not only did not drive but were cocooned in their homes for months,” and “in terms of being fair to people”, it could be done based on income and car size.

Motorists can avail of a tax waiver if they declare their car off the road in advance. Ms Murphy had asked the Minister if he would offer a means for motorists to avail of a waiver of motor tax when they could not possibly have declared their vehicles off the road ahead of Covid-19 restrictions.

Mr Ryan, however, indicated that a change in the law would be required to provide such a waiver and “there are no plans currently to amend motor tax legislation to provide for the waiving of arrears of motor tax”.

He listed the income from all the motor vehicle categories. A total of €362,164,467 was collected over 4½ months, including €294,578,977 for private cars but just € 3,936 for electric cars.

The next highest category of motor tax income was €57.19 million for goods vehicles and €60,268 for electric-powered goods vehicles.

Agricultural tractors, trench diggers and excavators accounted for €3.861 million in motor tax income, while motorbike owners contributed €2.08 million in tax.

Taxi and hackney owners paid almost €700,000 in tax during the pandemic period while the charge for school buses was €17,067.

He listed all the State financial interventions during the pandemic from exchequer funds in explaining the Government’s refusal to offer motor tax refunds or waivers, including rates waivers for businesses, restart grants lending facilities and equity injection.

Mr Ryan also pointed to the pandemic unemployment payment, the temporary wage subsidy scheme and the July stimulus package.

Vehicle category and gross motor tax receipts

March 1st – July 16th

Private car (engine capacity): €113,934,233

Private car (electric): €3,936

Private car (internal combustion engine): €180,644,744

Goods vehicle: €57,198,505

Goods vehicle electric: €60,268

Agricultural tractor/trench digger/excavator: €3,861,435

General haulage tractor: €112,055

Dumper/forklift truck: €118,424

Machine/workshop/contrivance: €685,361

Large public-service vehicle: €631,209

School bus: €17,067

Youth and community bus: €42,215

Hearse: €43,318

Island vehicle: €24,301

Motor caravan: €762,722

Motor cycles: €2,081,506

Vintage motorcycles: €77,958

All other vintage vehicles: €1,155,543

Total: €362,164,467