Budget 2027 VRT Increase: What the Rise on Bands 3 to 20 Means for Your Import

From 1 January 2027, the Vehicle Registration Tax rate on every Irish passenger car above 80 g/km of CO₂ goes up. The Department of Finance says the Category A rates for bands 3 to 20 rise “by 1%”, while bands 1 and 2 — most electric cars and plug-in hybrids — are unchanged, and the €5,000 VRT relief on electric cars now runs to the end of 2028. For an importer, the date that decides which rate you pay is the day the car is registered, not the day you bought it.

What did Budget 2027 change on VRT?

Budget 2027 made two VRT changes, both now in the Finance (No. 2) Bill 2026. From 1 January 2027 the Category A VRT percentage rates for bands 3 to 20, which cover cars with CO₂ emissions of more than 80 g/km, increase by 1 per cent, and the rates for bands 1 and 2 stay as they are. Separately, the VRT relief for electric vehicles, due to end on 31 December 2026, is extended for two years to the end of 2028.

The Tánaiste and Minister for Finance, Simon Harris, announced both measures on Budget Day, 6 October 2026. The Department of Finance published the Bill on 19 October 2026 and describes it as implementing the Budget Day tax changes. Until it is enacted the change is a Bill, not law.

Does “1%” mean one percentage point?

Almost certainly, but Revenue has not yet said so in a table. The Department of Finance writes that the “percentage rates” for bands 3 to 20 “will be increased by 1%”. Band tables published since the Budget, such as vrt.ie’s, read it as one percentage point, taking the top band from 41 to 42 per cent. The literal alternative — 1 per cent of the rate, so 41 becomes 41.41 — would be an unusual way to set a tax band. We show both below so you can see the range, and we will update this report when Revenue publishes the 2027 table.

Revenue defines each band as “more than” the lower figure “up to and including” the upper one, so a car at exactly 80 g/km stays in band 2 and is unaffected.

How much more VRT will you pay?

On the percentage-point reading, €100 for every €10,000 of open market selling price, in every band from 3 to 20. On the literal reading, the increase is 1 per cent of what you would have paid. The worked examples below use Revenue’s current rates and cover the CO₂ charge only; the separate NOx levy on petrol and diesel cars is not part of this change and is left out.

The OMSP is Revenue’s figure for what the car would sell for in Ireland, not what you paid for it abroad, so the increase follows the car’s Irish value rather than your invoice. The Government expects the change to raise about €37 million in 2027, according to The Irish Times.

Figures are indicative and for guidance only. Actual VRT is charged on Revenue’s OMSP and varies by model, year and mileage. Always confirm current rates and your specific case with Revenue.ie before committing to a purchase.

Does this apply to you?

It applies to anyone registering a car above 80 g/km in Ireland from 1 January 2027, new or used, bought in Ireland or imported, petrol, diesel or hybrid. The Irish Times reports that nine of the ten best-selling new cars in Ireland are affected, the Toyota Yaris Cross and the Yaris hybrid among them.

• Not affected: battery-electric cars and plug-in hybrids at or under 80 g/km, which sit in bands 1 and 2.
• Not affected: a car already registered in Ireland. Revenue charges VRT when a vehicle is registered in the State.
• Affected: a car you have bought but not yet registered, if registration falls on or after 1 January 2027.

Is the car still legal to import? Yes. Nothing in Budget 2027 changes what may be registered in Ireland. It changes only what it costs.

Should you rush an import to beat 1 January?

Usually not. Revenue states that VRT is paid at the time a vehicle is registered, and that a motor vehicle must be registered within 30 days of entering the State. A car that lands in December can still be registered at the current rate, if the NCTS appointment falls before the year ends. A car that lands after Christmas cannot.

Weigh that against what is at stake. On a €30,000 hybrid the increase is at most €300. Paying for faster freight, or taking a worse car because it is available sooner, to save that sum is a bad trade. On a €70,000 car in the top band the gap is up to €700, which is worth planning around but not worth compromising the car for. Work back from the sailing date on your quote: if the car cannot be registered by 31 December, price it at the 2027 rate and decide on that number.

Our Ireland import cost calculator runs on Revenue’s table in force today, so for a car you will register in 2027, add the change on top. When you have the car in mind, you can import a Japanese car to Ireland with the VRT worked out for your registration date before you commit.

The electric car relief, extended

The VRT relief for electric cars was due to end on 31 December 2026. Budget 2027 extends it to the end of 2028: electric cars with an OMSP up to €40,000 keep relief of up to €5,000, and those between €40,000 and €50,000 receive reduced relief. Our August report on Ireland’s EV incentive timetable was written before the Budget and has been updated with this change.

Is this just news, or is someone selling you something?

The Government presents the change as an incentive towards lower-emission cars. The Society of the Irish Motor Industry called it an unnecessary expense for buyers already facing higher fuel costs, while welcoming the EV relief extension, according to The Irish Times. Both are positions. The arithmetic is the part you can check: up to €100 per €10,000 of OMSP. Anyone using 1 January to hurry you into a car is selling the deadline, not the car.

What we could not confirm