Independent TD for Laois Offaly, Carol Nolan, has said that the Government does not seem to fully appreciate the scale of the fuel and energy crisis facing the public, as well as the road haulage and agriculture sectors.
Deputy Nolan’s comments come as the cabinet agreed to slash excise duty on petrol, coming into effect at midnight last night. At a meeting in Dublin, ministers agreed to a 20 cents cut in tax on unleaded petrol, 15 cents on diesel and 2 cents on green diesel. The reduction will remain in place until 31 August and will cost €320 million.
The government made the decision after stark warnings from experts about the knock-on impact the Russia-Ukraine war would have on fuel and food security. The soaring cost of fuel has also been blamed on long-standing Government policies.
Speaking this week, Independent Rural TD Michael Collins hit out on the Government’s carbon tax policy.
“It is selfish for this government to continue increasing the carbon tax. In fact, since taking office, FF, FG and the Greens will have hiked the price per tonne of carbon by a whopping 86 percent come October 2022,” Deputy Collins said.
“While supply chain concerns, caused by Vladimir Putin’s brutal invasion of Ukraine, have augmented the problems, it is, in fact, this government’s energy policies and crippling carbon taxes that are the key driver of skyrocketing fuel and energy prices.”
Deputy Nolan was speaking after the Taoiseach Micheál Martin appeared to rule out further reductions in excise duty.
The Taoiseach also confirmed to the Dáil that Ireland was bound by EU regulations to limit the excise duty cuts.
Commenting on the latest developments Deputy Nolan said, “I have never seen the levels of fear and genuine alarm that is currently out there among hauliers, agricultural contractors and the public who have no other option but to use their cars for work or travelling to third level or childcare.”
“In fact, the 2c cut in excise for green diesel is being taken by farmers as the clearest sign yet that Government are utterly clueless about the scale of what needs to be done if food security in this state is to be maintained.”
“To a man and a woman, the hauliers are telling me that they will have no option but to keep their vehicles off the road if radical measures are not taken. Indeed, there is concern among some of the hauliers I have been in contact with that fuel will be hitting €2.50 per litre by the end of the week. That is a completely destabilising level of increase that will cause paralysis in the sector.”
“Government, at the very minimum, must immediately reverse the decision to increase the carbon tax taken in Budget 2022 and the proposed carbon tax increase on home heating oil that is due to come into effect in May. There is nothing in EU law as far as I am aware that is preventing Government from doing that. It is entirely a political decision.”
“If the fuel rebate scheme is not re-examined for hauliers and the transportation sector and if the agri-sector cannot get relief in terms of a support package for the purchase of fuel then this country is going to come to a shuddering halt very quickly,” concluded Deputy Nolan.
Meanwhile, the representative body for the fuel sector in Ireland has voiced concern that the reduction in excise duty on petrol and diesel will not be enough as wholesale prices soar. Fuels for Ireland said on Wednesday that in the past 24 hours, the cost of diesel on wholesale markets rose by 22c a litre and that the Government must put immediate pressure on European partners to consider potential changes to VAT on fuel describing the situation as “urgent”. The body also said it was worried about retailers and suppliers who have purchased fuel supplies in the past few days and paid excise at the higher rate, who are now facing the prospect of selling it at a loss.
Speaking on Wednesday, finance minister Paschal Donohoe defended the Government’s handling of the situation, insisting that Ireland is ‘not in a position’ to place a cap on rocketing fuel prices because it is a country that must buy the majority of its own fuel.
“We are experiencing the consequences of a war. The government is acting now, with this excise measure in response to price rises that we have seen today but also in anticipation of further rises that we do expect to see over the short to medium term.”
Mr O’Donohoe, when asked about the possibility of price regulation, said it was unclear how that would be implemented for countries who import the majority of their fuel, which is the case for Ireland.
“We’re not in the situation where we have access to the majority of our fuel needs from our own sources. That means the relationship that we have with external supply is very important.
“For that reason, we’re not in a position to be able to give a commitment in relation to putting a cap on the price of fuel.”
“For a country that has to buy most of its own fuel, I currently don’t see any way that a price cap could be implemented, that wouldn’t either cause further economic difficulties or would cause an issue with the supplier”.
As reported by Gript, AA Ireland this week said that petrol and diesel costs have reached record highs, as Applegreen warns of huge increases in the cost of fuel for consumers. The cost of running an average family car has increased by over €900 annually since before the onset of the Covid pandemic. With fuel prices rocketing across Europe, a variety of factors are to blame for the increase, with the majority of the cost of petrol and diesel coming from tax. Government charges like Carbon Tax are a huge factor, alongside supply chain issues from the Covid lockdown and an overreliance on Russian gas as the conflict in Ukraine continues to worsen.
Despite calls for a more significant cut to excise duty as a means of improving the situation, Tánaiste Leo Varadkar said this week he would not move to reduce taxes on fuel unless the EU collectively decides to act.
Yesterday, Rural Independent TDs slammed the Government’s Carbon Tax policies, saying they had repeatedly warned in the Dáil that such a situation would unfold, but that insistent calls had been ignored.
“They’re supposed to protect Ireland – not tax us out of existence,” the group said, adding, “We told you so.”