LAST UPDATE | 9 Mar 2022
A CUT IN excise on petrol and diesel has been signed off by Cabinet this morning.
An incorporeal Cabinet meeting was held this morning where ministers greenlit the cut. This will be followed by a Dáil resolution to sign off on it.
It’s expected the cut will kick in from midnight tonight and last until the end of August. The expected cut in tax take is estimated at €320 million.
The excise duty cut amounts to 20c per litre on petrol, 15c per litre on diesel and 2c on marked gas oil.
At the press conference, Minister Paschal Donohoe said that filling a 60-litre tank should therefore reduce by an of €12 for petrol and €9 for diesel.
Over the weekend, senior sources confirmed to The Journal that the Government would move to cut excise within the week as the price hit €2 per litre mark for petrol and diesel on some forecourts.
AA Ireland has welcomed the excise cut but encouraged service stations not to increase prices to take advantage of the tax reduction.
“We would hope that the service stations would play ball. We have no control over that. We can only encourage them to do so,” AA Ireland’s head of communications Paddy Comyn told The Journal.
“Will it have a massive effect? Probably not because there are some elements that are out of the Government’s control and out of everyone’s control. The price of barrel of oil is now hitting around $130. So if that keeps increasing, then the price at the pumps is going to keep increasing and that sort of 20c reduction might just bring us back to where we are now.”
During today’s press briefing, Donohoe was asked whether the government could index link the cost of excise duty to fuel costs to ensure that the price for consumers actually goes down.
The Finance Minister expressed concern that such an approach could end up being too expensive.
“The challenge to that approach is the cost that would be involved in relation to it,” he said.
If we were to make a commitment at this point that we can link what we collect in tax to the rise in the price of fuel and how that price could change in the future, that will open up even more costs, even more bills that we ultimately have to pay with people’s money.
Minister for Public Expenditure Michael McGrath also said that a price “cap” on a litre of petrol is not possible.
“Governments cannot fix the price of the pumps or set a cap. That would create a enormous difficulties and uncertainties and probably result in the closures of businesses or put at risk stable supply into Ireland, so that is not a responsible position to take,” he said.
Prior to the war in Ukraine, there were already significant increases in fuel prices, Taoiseach Micheál Martin said yesterday, adding that they have only gotten worse since the onset of the invasion.
He said there is “no question” that costs will go up as a result of the conflict.
“So Government is acutely aware of this issue. We don’t argue that the impacts of people are not sustainable at the rate that these increases are occurring,” said the Taoiseach.
Speaking to RTÉ’s Morning Ireland today, Agriculture Minister Charlie McConalogue said the Government is “really conscious of the price pressures that have been on the public as a result of fuel increasing over the last number of weeks”.
“Our intention is to relieve the pressure on the public and to try and address the challenge that the rise in price has meant for people. It’s also something that we will continue to monitor over the next period of time, as well,” McConalogue said.
The US and UK yesterday announced they were cutting off Russian energy imports while multinationals Shell and BP said they would halt new oil and gas purchases.
Ukrainian President Volodymyr Zelenskyy welcomed the announcement coordinated between the US and UK yesterday to hurt Russia financially over its invasion of Ukraine and said they had sent a “powerful signal” to the world.
In his daily address to Ukraine, Zelensky said: “This is a powerful signal to the whole world. Either Russia will respect international law and not wage wars, or it will have no money.”
- With reporting by Christina Finn, Rónán Duffy, Ian Curran and Press Association
To embed this post, copy the code below on your site
have your say