Dáil debates

Wednesday, 22 February 2023

Financial Resolution No.3: Value-Added Tax

 

8:37 pm

Photo of Matt CarthyMatt Carthy (Cavan-Monaghan, Sinn Fein) | Oireachtas source

I welcome the opportunity to participate in this debate. I appeal to the Minister to support our family farmers who are under enormous pressure at the moment. The measures proposed by the Government will increase the cost of agricultural diesel by 1 cent per litre in June, a further 1 cent in September and a further 3 cent in October. Those are costs that farmers cannot bear, particularly if the base price of diesel remains unchanged and certainly not if it increases. However, that does not tell the whole story because as well as restoring the excise duty, the Government is also planning on increasing the excise duty in May through a carbon tax hike. In this instance, the carbon tax is so cruel and unfair because there is no alternative for agricultural diesel for tractors and heavy machinery. For the vehicles and machines that need agricultural diesel, broadly speaking there is no electric alternative and if there were, most farms in Ireland would not have hope in hell of being able to afford them at this stage.

All that an increase in agricultural diesel does is to increase the costs for farmers going about their business. It increases the cost of them doing business. In reality increasing the cost of farming is increasing the cost of food. Adding a carbon tax to agricultural diesel is just a form penalisation.

It is part of an agenda of demonising those who are central figures in our rural economies and communities. For this reason, we need to reconsider. I appeal to the Minister to support Deputy Doherty's amendment in this regard. We should not proceed with an additional excise on agri-diesel in May.

There are areas where the agricultural sector must be central in addressing its emissions, but the areas where the interests of agriculture and the environment merge are the ones where the Government is preventing farmers from playing a part. I have just come from the Joint Committee on Agriculture, Food and the Marine's umpteenth meeting on forestry. Afforestation rates are embarrassingly low - they are at their lowest levels since the 1940s. Think about that for a second. More trees were being planted annually in Ireland in the middle of the Second World War than there are now. Only 66 ha were planted in January. It is a national scandal, given that it comes on the back of a new afforestation programme. On 8 February, the Minister suggested that 1,000 ha had been planted last month. That is how far reality is from the heads of this Government. The Government is always talking about anaerobic digestion, yet the Minister, Deputy Eamon Ryan, only came to the realisation late last year. If he had listened to farming organisations over the past ten years, they would have told him that it was a way of supporting farming families, helping the environment, producing renewable energy and providing a significant financial and economic boost and that it could be done on a regional basis. Nothing has been done, though. I cannot remember exactly which number report we are on in this regard, but that is what the Government is doing now.

Our pathetic targets in respect of organics are being missed wildly and that will continue to be the case because they are not underpinned by a strategy. There is no strategy for the promotion and marketing of Irish organic products. There is no procurement policy that would mandate public bodies like schools, hospitals and the Dáil canteen to invest in organic, locally produced food. This would be good across the board, particularly for farmers.

Farmers are crying out to participate in renewables, including solar generation. Is the Minister for Finance aware that there are farms in this country that have solar panels on their roofs but that are barred by law from connecting their excess electricity to the grid? That is how ludicrous the situation is in some areas, thanks to the way in which farmers receive their grants.

There are areas where farmers should and must play their part. In almost all of those areas, though, the barrier lies not with them, but with the Government. Instead of focusing all minds on those areas where we can support our local communities and farmers and help the environment, the Government reverts time and again to measures that penalise and demonise and do people a great disservice.

Members of the Government, particularly in the Green Party, get frustrated when they are accused of having an anti-rural bias, but it is sometimes difficult not to make that assertion. Take how the carbon tax is applied as an example. It disproportionately impacts on poorer people and people in rural communities because it is a charge by the Government on people for doing things they have to do and to which they have no alternatives. Many people in my community have no choice – if they want to get to work, they have to take their cars. Every year, through the imposition of carbon tax, the Government makes it more expensive for them to do that. If they want to travel to their local health service, be it a GP or hospital, they have to take their cars. God forbid if they had to wait for an ambulance, but even the ambulance would be powered by diesel. Rather than taking the approach that would allow rural communities to move away from having diesel-powered engines in their cars by providing public transport and ensuring they have services, the Government targets them.

Nothing exemplifies the fact that there is an anti-rural bias in the Government's cost-of-living measures more than its approach to home heating oil. It is a fact that the more rural the community you live in, the likelier you are to depend on home heating oil to heat your home. Since the beginning of the cost-of-living crisis, though, the Government has actually added excise duty to home heating oil in the guise of carbon tax. At the same time, it has implemented measures to help other people to heat their homes. The Government is doing nothing. This situation would be laughable were it not so serious. The Government is charging people for using something to which they have no alternative.

The language around what the Government does with the carbon tax has changed. Initially, the Government sold the carbon tax as a mechanism by which to wean people off – that is the term some Ministers like to use – fossil fuels. As has been proven over the past 12 months, though, you cannot wean someone off his or her car if he or she has no alternative to it in order to go about his or her daily business. You cannot wean someone off an open fire or home heating oil if he or she does not have a mechanism to change fuel sources.

Consider where the carbon tax is spent. It is not spent on supporting families that are making a transition. Instead, it is a major transfer of wealth away from the poorest people in our society to the wealthiest. Those who are in a position to buy brand-new electric vehicles are the ones who get the carbon tax. They are not the people who are forced to drive to work every morning in my community. Wealthy people who can afford to carry out full retrofits are the ones who benefit from retrofit funding while those who want to apply for the schemes for which they are eligible have to wait years. This major transfer of wealth is unfair.

I appeal to Government Members to support Deputy Doherty's amendments. There is a better and fairer way of doing business. There is a way for us to have a well-functioning and well-resourced economy while ensuring that we meet our climate action targets without penalising people for just going about their daily business.

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