Fuel providers are calling on the Minister for Finance Jack Chambers to postpone the planned excise duty increase on fuels set for August 1st.
This duty was reduced by 20 cent per litre for petrol, 15 cent per litre for diesel and 2 cent per litre for marked oil in 2022 in response to the cost-of-living crisis sparked by Russia’s invasion of Ukraine. The planned increase will see petrol rise by 4 cent and diesel rise by 3 cent.
Due to the Dáil recess this week, the Minister has days to make a decision about the planned increase.
In March 2022, the Government reduced excise duties on fuel in light of the impact of the rise in energy prices due to Russia’s invasion of Ukraine. These reductions were originally scheduled to end in August 2022. Excise duties are a government levy charged on certain products such as alcohol, tobacco, diesel and petrol.
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Applegreen, Certa, Circle K, Greenergy, Irving Oil, LCC, Maxol Top Oil and Valer are all part of the group Fuels for Ireland lobby group which is seeking the postponement.
Despite the 2022 reduction excise duties were increased in April this year when petrol rose by 3 cent, diesel by 4 cent and marked gas oil by 1.5 cent.
The planned carbon tax increase in Budget 2025 will also add 2 cent per litre to the price of fuel, while the country’s commitment to the Renewable Transport Fuel Obligation will add another 2 cent per litre on January 1st. This an initiative designed to promote the use of renewable energy.
The carbon tax increases were pre-agreed in the Climate Action and Low Carbon Development (Amendment) Act 2021 that mandated carbon budgets for 2012-2025; 2026-2030. The Renewable Transport Fuel Obligation, agreed in 2021, sets out a pathway for fuel suppliers to achieve a 51 per cent reduction in emissions by 2030.
Fuels for Ireland say that it would mean a total increase of 5 cent per litre to petrol and diesel in the next six months after VAT is applied.
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Forecourts near the Border have seen less business since April 1st as customers drive to Northern Ireland to fill up their tanks, the lobby group says.
Fuels for Ireland chief executive Kevin McPartland is calling for an expert group to be created to address issues in energy policies. The expert group would establish how the fuel industry can ensure that the government will still be able to collect revenue from the sale of energy as it is an important source of income, while supporting the transition to sustainable energy sources in line with commitments in the Renewable Transport Fuel Obligation. He also pointed out the expert group should ensure that people are not priced out of the energy market.
The chief executive cited the cost-of-living crisis in Ireland and how the increases in excise duty are viewed as a “stealth tax” as reasons not to increase prices.
The latest fuel excise data released by the Central Statistics Office show diesel sales in April 2024 was 3 per cent lower than the same time last year, while petrol was 2 per cent higher.
Fuels for Ireland has urged Government to “act now to prevent exacerbating these issues as it is not fair for consumers to bare this addition burden”, the chief executive said. “Postponing the excise duty increase and establishing the expert group on taxation will demonstrate a commitment to balancing fiscal responsibility with consumer affordability.”
The Department of Finance was contacted for comment.
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