Used car shortages and Brexit
Deputy Griffin raised the shortage of quality used cars, higher prices and the impact of Brexit-related tariffs, VAT and VRT on imports from the UK. The Taoiseach said the issue was a consequence of Brexit and explained the tariff rules under the EU-UK Trade and Cooperation Agreement.
I wish to raise the issue of the shortage of quality used cars on the Irish market and the difficulty this is causing consumers, who must pay more for cars than they are worth. Used car retailers are also experiencing severe difficulties trying to import cars from the UK, especially with the extra 10% tariff arising from Brexit. They must also pay the top rate of VAT. There have been VRT changes relatively recently as well. This matter spans a number of Departments. Will the Government take immediate action to examine the issue and see how policy can improve the overall situation? Perhaps in the context of the forthcoming budget, it could examine the issue of applying VAT to imported cars and whether the tariff could be scrapped or reimbursed to trader account number, TAN, holders so as to get the industry moving again and to support jobs, many of which are in small operators in rural communities who work hard and serve their communities.
Comment on this
This is one of the many consequences of Brexit. I saw during the week that the exports to the European Union of one third of UK companies had declined. The ramifications of Brexit on the UK economy are going to be sustained in the long term.
Regarding the Deputy's point, the EU-UK Trade and Cooperation Agreement has eliminated tariff duties on trade between the European Union and Great Britain where the relevant rules of origin are met. This means that, if an imported vehicle is of UK origin, there is no customs duty payable, as a 0% tariff rate applies. The following vehicles would not qualify as being of UK origin under the rules of origin, so a 10% tariff would apply: imported vehicles of EU origin used in the United Kingdom or vehicles of other third country origin used in the UK. Vehicles originally exported from the European Union to the United Kingdom that meet certain criteria may be eligible for returned goods relief under the EU customs rules, namely, the Union customs code.
We will continue to examine this and, as it settles down, we will try to get some progress on these issues.