Motorists are facing the prospect of new hikes in the cost of petrol and diesel, set to widen the gap between costs in the north and south. Fears have been voiced that an increase in fuel excise duty could shut smaller petrol stations operating on the border, after the government turned down calls to postpone the hikes in excise, set to come into force next month.
Motorists can expect to pay more at the pumps from 1st April, when the increases in excise duty take effect, meaning the cost of petrol will rise 4c a litre, and diesel by 3c. Fuel prices will once again increase by the same amounts on 1st August, by which stage the government will have restored the full excise duty on petrol, diesel, and green diesel.
It follows the UK government’s announcement last week that it will extend its reduced fuel excise duty rate for another year. The differing approach taken by the UK means that fuel prices in the North will eventually be roughly ten per cent cheaper than in the south.
While the Irish government initially planned to reverse the cuts, introduced in the wake of the Russia Ukraine war, last October, this was postponed until this year in the Budget.
Speaking on MidWest Radio, one TD expressed concern that the increase in petrol and diesel prices in the Republic will be detrimental for smaller businesses in the border counties.
Sinn Féin’s Transport spokesperson, Sligo-Leitrim TD Martin Kenny, told the programme that the government needed to take notice of the impact the restoration of excise duty would have.
“They need to take cognizance of the fact that there are many businesses on both sides of the border that have real issues when people travel North; when they get all of their shopping as well as their fuel because of the attractive prices in the North.”
“Any adjustment to prices of that nature […] the government needs to take cognizance of the fact that it can cause huge problems, and the loss of business – and indeed the closure of small retail businesses and filling stations in the south.”
Speaking to Pat Kenny on Newstalk on Monday, Petrel Resources Chairman David Horgan said it seemed there was a “deliberate” government policy to make it harder to be a motorist. Mr Horgan said motorists could expect to see prices increase by as much as 10 per cent.
“The Government is taking a very hardline on re-imposing the excise duty reductions that were put in during the pandemic, even though the British have deferred it for another year,” the chairman of the Irish based exploration and production company told the Pat Kenny Show.
“Basically, there seems to be a deliberate Government policy to make it more difficult to be a motorist and the net result is if those two increases are imposed this year, you’ll find a 5% increase just from the restoration of excise – plus VAT.”
“In the 80s, it used to be much cheaper in the North but in the noughties, it was cheaper in the Republic,” he added.
“It’s probably not worth your while now driving from Dublin to Newry to make a fill because the time and transaction cost will outweigh savings.
“But the tragedy for the Republic here is that instead of being subsidised by northern consumers coming across the border from the likes of Donegal, we will now be subsidising the British taxpayer,” Mr Horgan said.
Mr Horgan also accused the government of introducing a “stealth tax”.
“The logic of the current Government is they are trying to drive people off the road and make them use public transport,” he told the radio programme.
“But many people don’t have a public transport alternative, either from age, mobility issues, or having small children.
“We need a policy whereby we give people the transport options they want – it should be the customer that decides”.
Recent data from AA Ireland reported that petrol and diesel prices have been on the increase, reversing previous price falls.