Olivia Mitchell (Dublin South, Fine Gael)
Link to this: Individually | In context

Question 65: To ask the Minister for Finance his estimate of the value of increased tax revenue arising from the increase in the cost of motor fuels. [13434/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

The taxation of motor fuel is made up of two elements, mineral oil excise and VAT. The amount of mineral oil excise collected is based on the volume of motor fuel sold, in this case the number of litres of petrol or diesel sold. The revenue collected from mineral oil excise does not fluctuate with price changes. Therefore, assuming there is no change in the volume sold, the increase in tax revenue arising from increases in the cost of motor fuels will correspond to an increase in VAT revenue.

Accordingly, I am informed by the Revenue Commissioners that the increase in VAT revenue arising during 2004 due to movement in national average retail prices for petrol and auto diesel is estimated at €22.9 million and €2.9 million respectively. These estimates are based on provisional volume clearances during the calendar year 2004. It should be noted that the VAT content of auto diesel purchases is a deductible credit for business in the Irish VAT system.