Irish leasing firms lose out on VAT reclaim

The new barrier-free tolling system on
Dublin’s M50 motorway has prompted anxiety over cost increases
amongst vehicle leasing firms which will no longer be able to
reclaim VAT on tolls.
The eFlow toll-free system, implemented on August 30 will incur no
VAT, unlike the 21 per cent element built in to the previous toll
charge, which companies could reclaim as a business expense.
The basic toll charge of €2 will remain unchanged.
John Wallace, president of the vehicle leasing association of
Ireland, said: “In effect, that’s a 21 per cent increase in cost
for a business user straight away. This whole thing is just a
fiasco. It’s taxes by stealth.”
Approximately 25-30 per cent of the 100,000+ vehicles using the M50
toll bridge daily are fleet or company vehicles. However, many of
these would be registered to rental firms with the ability to
reclaim tolls from their customers.