Oireachtas Joint and Select Committees

Tuesday, 8 May 2018

Committee on Budgetary Oversight

Environmental Impact of Fiscal Instruments: Discussion

4:00 pm

Photo of Colm BrophyColm Brophy (Dublin South West, Fine Gael) | Oireachtas source

I have a number of questions for Professor Morgenroth. One of the most interesting things I took from his briefing and the questions he answered is that we are caught in a bind of our own making. As Deputy Broughan and Deputy Lahart alluded to, as a State we have historically used motor taxation as an effective revenue driver by having it so high at 10% of revenue raised. Our ability to influence environmental change through taxation is limited because if it is successful there is a major problem in that something we rely on as a revenue stream is compromised.

There seems to be a body of work. If future Governments want to incentivise an environmental regime of change through taxation then we will have to come up with another way. I am not saying that we give up taxing transport as a sector in terms of when people buy cars or whatever. However, the traditional model of collecting duty on fuel, road taxes, etc., will have to be considered.

I wish to advise members that we will invite representatives of the road haulage industry and various other people to meetings. I am struck by the fact that the Irish model means we will need diesel vehicles for a long time, and we will still require some diesel vehicles even with the 2030 situation. Am I correct? One reason is that the technology to produce a pure electric vehicle has not reached an advanced stage. Hybrid technology is effective when one uses it in a city or urban environment at a low speed and drives in a city or urban area. A hybrid car would use an entire tank of petrol if one drove from Dublin to Cork or a similar length of journey. Therefore, hybrid vehicles do not provide a real environmental gain when driven outside of an urban area. Am I correct?

I want Professor Morgenroth to clarify a contradiction for me. We talk about how effective changes can be but we, as a country, have shifted to using diesel vehicles in the 2008 period more than any other European country. Some countries now have their own issues with diesel. Certainly, from my experience of countries ranging from Spain, Portugal and up to Germany, the number of vehicles that use diesel is less than Ireland. Professor Morgenroth has said that the ability to have an effect through taxation is limited because of the high amount. If so then why has the taxation measure been so effective in this country? Can we learn from what we did in 2008 to re-engineer the system?

Comments

No comments

Log in or join to post a public comment.