Exporters meet Minister Leo Varadkar and demand urgent action to offset the creeping impact of EC Transport directives and regulations on the competitiveness of dairy, agri –food, drink and pharma / chemical exports

A delegation from the Irish Exporters Association today (7th July ) met with Minister for Transport, Tourism and Sport , Leo Varadkar TD to call for immediate action to offset the Impact a number of EU Directives which have over the past year substantially increased the cost getting goods to our main European markets .

John Whelan, Chief Executive of the IEA stated on entering the meeting with Minister Varadkar ;
‘’The Euro-vignette directive which is a HGV transit charge in many European countries, has been further extended on the 6th June to cover air and noise pollution, and will result in an estimated €97.5 million added cost each year to Irish exports transiting Europe.‘’

The IEA advised the Minister that the euro-vignette will impose an average “road use” charge on vehicles above 12 tonnes weight within a range 15c to 25c per kilometre and that the pollution and other “external” costs would be charged in at an average of between 20% and 30% of that figure. Exported products are shipped mainly by driver accompanied trailers and using the UK Landbridge to access continental markets. This routing gives the exporter up to 60 suitable sailings on the Dublin to Liverpool/Holyhead corridor each week and using these along with the Dover Straits, high frequency services door to door of between 30 and 40 hours can be achieved to most Continental destinations. A truck transiting Britain via Holyhead and Dover would, under the proposed regime incur approximately €120 road use charges and €30 “external costs” charges. This gives a total cost of € 300 for the round trip and could validly be seen as the extra cost that Irish based businesses incur and a measure of the cost of peripherality. The IMDO figures show the number of Driver accompanied freight

vehicles moving through Irish Ports as being over 650,000 in 2008. Of these, approximately 50% would be running through to or from Continental Europe. Hence we are looking at €97.5 million added transport costs per year to be absorbed by Irish exporters to the continent under this Euro-vignette regime.

John Whelan also stated the IEA would further advise the Minister that the Euro-vignette Directive amendment 2006/38/EC, which lowered the tonnage eligibility for charging from 12 to 3.5 tonnes, is due for introduction in 2012. The IEA would fear that in addition to the on going long term increase in motor fuel costs, that these increased charges across Europe would damage future export growth.

John Whelan concluded by saying;
‘’We are offering the Minister two options ; either introduce a special user diesel rebate scheme or reduce road tax on goods vehicles as the effect on export / haulage costs since the Directive’s implementation has damaged manufacturers export competitiveness . The IEA have advised the Minister before today’s meeting that it is vital for the Government to urgently offset the cost of the EU Euro –vignette system to avoid damaging any further Irish exports to Europe, and for either a special user diesel rebate to be implemented or a HGV road tax reduction to be effected.

The IEA advised that the Special User Diesel Rebate of approx. 5 cents per litre would be required to return the €97 million back to export industry, or reduce HGV road tax from €2300 per annum to the EU average of €900 per annum. Either would serve to offset the increased costs associated with the Euro –vignette system. Currently, Irish hauliers contribute an estimated €365 million in motor diesel excise, representing 35 per cent of the total motor diesel excise revenue in Ireland. In France the Special User diesel rebate has been in place for some time, as they were early implementers of the Euro –vignette system.

In line with the EU Directive 1999/62/EC, vehicle tax on hauliers can be lowered to the minimum allowed level. The Directive also allows Member States have the option, under certain cases and subject to certain conditions, of applying reduced rates or granting exemptions to vehicle tax.

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