I've been spending a bit of time recently looking at NOx figures for a variety of cars, years, etc. As well as that I've been keeping an eye on VRT for some models as I've been contemplating options for a purchase. I've noticed something interesting.

To calculate VRT you need three key pieces of information, the original OMSP - supposed to be an approximation of the list price new, but usually a littlle bit less and generally a number that doesn't change, the depreciation code - which can change from time to time and determines the residual value based on the age of the vehicle and the CO2 number - to determine the VRT rate and is a clear number for any given car. Then, just apply the formula. Going forward, an accurate NOx figure will be important too.

Since the beginning of the year Revenue have adjusted (increased) many, if not all, OMSP's by an amount that equates to the NOx levy. This is most unusual. Given the way that VRT is calculated, and that no other elements of the equation have changed, it means that VRT has increased slightly for all cars. More significantly, although technically the NOx levy isn't a tax, it effectively means that people importing cars going forward will be paying tax on a tax.

It looks like this may push some of the OMSP's over the official list prices of the cars when they were new. I suspect there could be a few grounds to appeal any VRT number for a while until they sort themselves out. There may even be some legal questions over how they've put it together, e.g. tax on tax.