THE GREEN Party has rejected claims by motor retailer Bill Cullen that it “killed the motor trade” through VRT changes.
The changes to the VRT system, which came into force in July 2008, linked the levels of tax to CO2 emission, resulting in cars with larger engines typically attracting high tax.
This, rather than the global recession, has been the major contributing factor to the collapse in motor sales in Ireland, Mr Cullen said. Car sales had fallen by 65 per cent in the first quarter of 2009. The fall in new car prices following the VRT changes had resulted in an even greater fall in the value of second-hand cars, he said. Buyers were unwilling to take on older “dirty” petrol cars, he said, so some one intending to buy a new car was unable to do so because they could not get a good enough trade in price for their old vehicle.
Speaking yesterday on RTÉ's Today with Pat Kennyshow, Mr Cullen told Green Party Senator Dan Boyle that the Green Party's insistence on the change had been a "disaster" for the industry.
“You’ve killed the motor trade, people can’t buy a new car and it’s all because of the Greens.”
As an environmental measure the VRT change was unnecessary as the EU already required car manufacturers to reduce CO2 emissions by 2010, Mr Cullen said, and all the Government had done was reduce the amount of tax for the exchequer by wiping out sales.
A spokesman for the Green Party said there was no evidence that the VRT change led to a collapse in car sales.
“It would be akin to saying stamp duty changes in 2007 caused the collapse of the housing market. It simply doesn’t stand up.”
Other countries, including Romania, Lithuania, Latvia and Estonia, had suffered similar or even worse declines in car sales in the first quarter of this year, showing that it was a phenomenon which was part of the global recession, the spokesman said.
Mr Cullen said the comparisons were disingenuous as these countries had low annual car sales and their motor industries were not developed to the same extent as in Ireland.
