Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I am glad the Minister is aware that the tax he is proposing is regressive. Let us remind ourselves of what the ESRI's June report stated in the context of carbon taxes. The author stated categorically, "Carbon taxation is found to be regressive, with poorer households spending a greater proportion of their income on the tax than more affluent households." The report goes on to state that an increase in carbon tax would disproportionately hit rural households, particularly rural households in the lowest income quartile. Most worryingly, it suggests that single households with children are going to be the most affected by the Government's policy, which is supported by Fianna Fáil. It states that while the tax should be borne by everyone, the cost is greatest for the poorest households, and that households living in older dwellings and low-skilled workers have larger costs. On Wednesday last, at a meeting of the Joint Committee on Climate Action, the Minister's officials categorically confirmed to my colleague, Deputy Cullinane, that this carbon tax proposal is regressive. That is a fact which cannot be disputed. A carbon tax increase will hurt those on the lowest incomes in Irish society and that is backed up in the research. Given that this is the case and given that the Minister said it would be ring-fenced for climate action measures, can he outline how his Department intends to ring-fence this increase? Can he outline whether he plans to ring-fence any of the €400 million in carbon taxes that we bring in every year? Can he outline if he has the necessary statutory instruments in place to ring-fence the moneys that will accrue from the carbon tax increase? What measures will this regressive hike in taxation next year likely fund?

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