THE GOVERNMENT has been urged to resist the temptation to adjust the tax bands, which came into effect on July 1st. Sales for the initial days following the changeover have been promising, with some 8,000 cars sold in the first eight days of July.
Eddie Murphy, chairman and managing director of Ford Ireland, said there has been a noticeable shift towards more fuel-efficient cars: "There has been a move towards diesel in the larger cars, and sales have been strong for our small cars, including the Fiesta, even though there is a new one coming down the line.
"After the first half of the year that we had, there was a fear that there would be more bad news coming, but the early indications for July have been promising and after the maths is done at the end of the month, we will at least be looking on the first year-on-year growth for this part of the year."
However, the industry fears that the Government will seek to boost revenues in the economic downturn by altering the VRT bands. With a shift away from larger petrol engine cars to more fuel-efficient diesel engines, Government tax income may suffer further as buyers pay less VRT and road tax.
"Together with organisations such as SIMI we have asked for a period of stability after what has been a difficult birth of the new system. If the Government is harbouring any thoughts of changing the system, we are asking it to leave it alone for at least a full calendar year to allow the market to find its levels," Murphy added.
Figures for the first eight days of July showed that the average CO2 emissions of cars bought in July was 141g/km compared to 162g/km in the same period last year.