MINISTER FOR PUBLIC Expenditure and Reform Paschal Donohoe has defended the incremental return of excise rates on fuel, calling them “necessary” and that it would have cost the exchequer €700 million this year if they were to remain as they were.

Rates increased by 6 cent per litre of petrol and 5 cent per litre of diesel at midnight last night, with another two increases planned for 1 September and 30 October of this year.

The rates were cut in March of 2022 by 20 cent per litre of petrol, 15 cent per litre of diesel, in an effort to tackle the cost of living after fuel prices began to increase dramatically.

The Public Expenditure Minister said if the government were not to bring the excise rates back, it would cost the exchequer €700 million which “would have to come out of all of our budget plans for 2024″.

A full tank of petrol has now increased by €3.60, while a full tank of diesel increased by €3 with the first wave of staggered increases.

Donohoe said: “I appreciate, for many, it’s a moment in which they’re going to see the price of fuel go up again. But it is in the context of the price of fuel, and diesel and petrol, [it has] come down a lot from where we were in April or May of last year.”

Petrol prices for this month were 157 cent per litre, according to AA Ireland’s National Price Index, with diesel costing 147 cent per litre.

The highest recorded prices by the AA’s monthly survey saw petrol prices average €2.13 per litre and diesel average €2.05 per litre in June 2022

Donohoe said with the price of petrol and diesel has “decreased significantly”, compared to last year when prices increased to record highs, since they brought in the tax reductions.

The Minister said: “With that in mind, it’s really important that we remove the tax reductions as the price of fuel itself has come down.”

Donohoe was speaking to reporters while opening two new buildings on TUDublin’s Grangegorman campus today, which cost €220 million and will serve over 10,000 students.