Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

As I said to Deputy Nash, this is a matter that will have to be reassessed when we get to the early part of 2023. While I hope the situation will improve by then, we cannot be certain of that by any means. The decision will be made at that point regarding whether this measure should be extended or, as we hope, moderated or even phased out if the living standard circumstances allow us to do that.

On home heating oil, the VAT reduction does not cover home heating oil as this is provided for by way of a historical derogation. It is, therefore, not legally possible to reduce these items to 9%. Under the derogation, the lowest level that solid fuels can be reduced to is 12%. If we were to reduce VAT on kerosene to 12%, the saving would be small, although I know that every saving does make a difference. It would amount to approximately €20 per 1,000 litres but there would be considerable additional costs to the Exchequer. This is because Ireland would also have to reduce the rate for all the other areas that are also subject to the 13.5% VAT rate at the same time, as we are only allowed to have two reduced VAT rates under EU law.