Some car dealers in Ireland are now importing vehicles from Japan rather than Britain due to a VAT hike brought on by Brexit.

Three-out-of-four cars sold in Ireland are second hand, according to the Society of the Irish Motor Industry. The market is made up of Irish trade-ins and imported vehicles.

However, since Brexit you now have to pay the UK VAT rate of 20% on cars being imported from there, on top of the Irish VAT rate of 23%.

Car dealers here say it now works out cheaper to import European cars from Japan, who like Ireland have right-hand drive vehicles, as they are not subject to the 20% VAT charge, unlike the British cars.

Eric Ryan, managing director of Ryan and Brien Motors in Bray in Co Wicklow, says before Brexit 90% of his car stock would have come from the UK and would have been premium cars, such as BMWs, Audis and Volkswagens.

However, a lack of supply in that market and rising costs due to Brexit means he is now importing these European cars from Japan.

He said: "Bringing the BMW in from Japan compared to bringing one in from England at the moment is going to end up with a complete price at the end of the day on the forecourt retail of approximately about €2,000 dearer for the UK model because of the extra costs of Brexit."

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