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Volkswagen has informed the Department of Finance, by letter, that it will cover any gap in the cost of motor tax and Vehicle Registration Tax for the cars on which it underestimated Co2 emissions and fuel consumption.
In the letter, which according to The Irish Times was sent directly to Minister Michael Noonan and signed by Mueller, the newly-installed Volkswagen CEO spoke about Volkswagen's under-estimation of Co2 emissions and fuel consumption on some 800,000 models across Europe and that "this could affect taxes or other public charges already assessed or to be assessed. We [Volkswagen] would like to inform you and the taxing authorities, which are subordinated to your ministry - also in the name of the Group companies Audi AG, Seat SA and Skoda Auto AS - that this could also be the case in your country."
Mr Mueller went on to say that the gap between the correct and incorrect Co2 figures is not yet fully established, but that Volkswagen will bear the cost of any changed to the vehicles' taxation rates, so that customers will not be out of pocket.
This latest Volkswagen scandal is separate to the diesel nitrogen oxide (NOx) emissions debacle, which first came to light in September. The under-estimation of Co2 emissions is a much more serious case for Volkswagen to answer in Europe, as it directly affects the vehicle's taxation, unlike NOx. In the United States, both Ford and Kia have been hit with hefty fines and compensation claims from customers for similar economy and emissions mistakes.
Volkswagen dealers are currently having to get customers to sign affidavits, which say that they're aware that the Co2 and consumption figures of the car they're looking at buying "as described in the brochures, catalogues and in any other marketing materials I have received or seen relating to the vehicles, may be inaccurate. I have been told that these values are currently under revision and may increase."
As well as paying the government any back taxes owed, and compensating owners for any costs, Volkswagen may also find itself liable for future increased tax costs. It won't have to recall the cars though, as there's no mechanical fault.