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Tóibín: Government are ‘gouging’ the people on fuel tax

Aontú leader Peadar Tóibín has hit out at the Government and accused them of ‘gouging the people’ on fuel taxation.

The Meath West TD highlighted the fact that Irish road users are paying more tax now on fuel than before the Cost-of-Living crisis took hold, owing to the fact wholesale prices have increased so much, which has resulted in the Government making more in tax. 

“When you put €120 of petrol into your car this week, the Gov will take over €50 of this in tax. Incredibly, the Gov is taking more in fuel tax now than they did before the Cost-of-Living Crisis took hold. The government are gouging the people”, Mr Tóibín said.

His comments come as the fuel industry urged the Government to reassess its overall approach to taxation on fuel. The lobby group Fuels for Ireland said that the argument that increasing fuel taxes results in decreased demand “just doesn’t follow”, as it criticised the fact that people are now paying 5 cent more in tax per litre of fuel compared to this time last year.

The price of petrol has continued to soar across the country and abroad, with prices in Ireland hitting and exceeding €2 a litre last week. Similarly, the price of a barrel of oil reached $120 last week. 

Speaking to RTE News last week, Kevin McPartlan, chief executive of Fuels for Ireland, which represents fuel retailers in Ireland, said that people in Ireland are still paying more tax on fuel now than they were last year due to the rise in wholesale prices, which comes despite the excise cut on petrol and diesel back in March.

He said that while there were a number of reasons for the increase in fuel prices, the issue of VAT on fuel was a matter the Government could deal with. Highlighting the fact that the same litre of diesel that costs €2 euro today cost roughly €1.40 this time a year ago, he said that the Government “need to have a long hard look” at the overall approach to taxation of fuels.

“For decades [the Government has] been telling us that if we increase the taxes on fuel, we’ll decrease demand – and it just doesn’t follow”, he said.

Central Statistics Office (CSO) Figures released last week revealed that inflation in Ireland is now at a 38-year-high. According to the CSO, consumer price inflation has been increasing at an annual pace of 5% or more since October 2021.

The cost of diesel has risen by 41.6%, while petrol has increased by 25.9% since this time last year; airfares are also up 45.4% in price compared to May 2021, according to the statistics.

Irish consumer prices have jumped by an average of 7.8% in the 12 months to May – the fastest pace in almost 38 years – an increase of 7% in the year to April. The worrying statistics reveal the largest annual increase to the consumer price index since 1984.

Rising energy costs are driving the price increases, with electricity now 41% more expensive than it was this time last year. The cost-of-living crisis has also seen gas become 57% more expensive, while solid fuels are up 26%.

The biggest increase was in home heating oil. According to the CSO, it has more than doubled in cost, recording a staggering 102% rise.

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