Motorists face price hikes at pumps despite Government pocketing €3.8bn in tax on fuel
Face Motorists And Year, The Further Total Diesel Three 14c 12c To For Petrol This Increases Hikes Bringing Price For
Motorists face further price hikes at the pumps from today despite the Government pocketing €3.8bn last year in tax on fuel — the highest tally in a decade.
From this morning, a litre of petrol will rise by 5c, with diesel jumping by 4c, as the Government looks to fully restore excise duty on fuel which was parked two years ago to offset the rising cost of living.
However, motorists face three further price hikes this year, bringing the total increases to 14c for petrol and 12c for diesel.
The first of those kicks in this August which is the final phase of the Government’s excise restoration programme.
Prices will also rise from planned hikes in carbon tax in October’s budget with an increase in the biofuels component of transport fuels set to impact costs further.
Despite calls for a further delay in fuel excise hikes — which were postponed in October until now — the Government has reaffirmed its commitment to restoring the excise duty, with the cost of delays quickly adding up.
Earlier this month, Finance Minister Michael McGrath said that while he recognises that households and businesses are facing challenges, “the Government must strike the appropriate balance between providing support and avoiding fuelling cyclical inflationary trends”.
Replying to parliamentary questions last week, Mr McGrath said by not proceeding with the three planned increases in April, August, and October, it would cost the exchequer €183.5m in total, comprising €55.3m for petrol and €128.2m for diesel.
However, recently released figures show the Government posted a tax take from fuel of just under €3.8bn last year — the highest in the past decade — despite cuts to excise duties.
Aontú leader Peadar Tóibín, who received the figures, said it was "an astronomical amount of money collected from tax on fuel" and showed that excise duty should remain cut.
“The reality presented in these figures is that the Government is actually cashing in on the rise in price and has taken in more tax than ever before.”
Fuels for Ireland, the representative body for fuel importers, said despite appeals, the Government will “forge ahead, leaving fuel retail operators and forecourts with no alternative but to adjust prices.”
“It is not an April Fool's story. Irish consumers will wake up to unwelcome news as fuel prices surge across the nation," said chief executive, Kevin McPartlan.
He said while the Government will argue that the restoration of excise duty is necessary to cool inflation, one “sure way” of fuelling inflation was by hiking prices.
“So between now and January 1 next year, the average price of a litre of petrol, which was €173.9 last week, will rise to €187.43 — that’s a 14c increase in eight months.”
He also called for a comprehensive review of tax on fuels in light of the Government's record €3.8b tax take last year.
"We have a problem that has built up over many years of ad hoc, knee jerk reactions — lots of minor tweaks to the overall tax on fuels.
"What we really need is a comprehensive review."
The Government’s push to restore the fuel excise duty has created a growing gap between prices in the Republic and Northern Ireland, with Mr McPartlan warning of the damaging impacts this will have on retailers along the border.
“The immediate impact of this decision will be felt most acutely in border counties, where the price gap between Ireland and the UK threatens the viability of local forecourts.
“With further increases slated over the next twelve months, the prospect of a two-tier fuel economy looms large, exacerbating existing cost-of-living challenges for citizens," Mr McPartlan said.