Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

I move amendment No. 17:

In page 97, after line 32, to insert the following:

“40.The Minister shall, prior to 1 May 2020, publish a report on reducing the impact of carbon tax on agricultural production in light of the fact that there are no viable low carbon alternatives available to farmers.”.

We discussed a similar amendment in detail on Committee Stage. Its focus is to consider the issue of carbon tax on agricultural diesel. Carbon tax is about bringing about change, not about bringing in more income to the Exchequer. The idea and pitch behind carbon tax is to drive change. The objective is that people will get out of the car and use public transport because it is more carbon efficient and they will pay less in fuel taxes.

The agricultural community does not have that choice because we do not yet have electric tractors and it will probably be a while before we have them in this country. As they do not have a choice, they should not be liable for the tax.

When we discussed this earlier, the Minister made the point that there is a double income tax relief for farmers. The difficulty is that a farmer has to be generating an income to avail of the income tax relief. As the Minister knows, very few beef farmers will pay tax this year because of the devastating year they have had. Only a handful of beef processors in the country will have a tax liability. Having a taxable income is the only way farmers can avail of relief for carbon tax paid on agricultural fuel. We need to consider another mechanism to ensure that people who do not have a choice, that is, farmers, have mechanisms whereby they can avoid paying the carbon tax on agricultural vehicles.

This leads us to a broader issue in terms of carbon taxes. The carbon tax structure in this country disproportionately impacts on people in rural Ireland. A typical commuting family in rural Ireland will pay an extra €6 per week in carbon tax, yet the equivalent family in Dublin will pay about 30 cent a week in additional carbon tax. The sum of €6 per week is a significant amount of money for a family, but alternative transport is not available to them. They have to absorb this as an additional cost. However, families in Dublin have alternatives, particularly the bus service, which is subsidised by the State, but 30 cent a week will not motivate any family to leave the car keys at home and get onto a bus. This tax disproportionately hits those who cannot avoid paying carbon tax.

Amendment No. 23 has been ruled out of order. It proposed that we try to restructure the motor tax system to drive the type of change that is needed, based on the fuel efficiency of a vehicle. A diesel car travelling through Dublin city is far less efficient than the same car travelling from rural Ireland to a job in Lucan or Leixlip. If the taxation system was restructured to take account of that, it would encourage people to leave their cars at home in Dublin without disproportionately penalising those living in rural Ireland who do not have a choice. We will not have the opportunity to discuss that amendment.

I want to flag this issue relating to agricultural fuel. The amendment would ensure that many farmers who do not have a taxable income would be able to avail of the relief.

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