Matt Carthy (Cavan-Monaghan, Sinn Fein)
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125. To ask the Minister for Finance if he will exempt green diesel used by farmers and farm contractors from carbon tax; and if he will make a statement on the matter. [30616/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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As I outlined yesterday in my Budget speech, I have increased the rate of carbon tax from €26 euro per tonne of Carbon Dioxide emission to €33.50 per tonne. This applied to auto fuels from midnight last night. I have delayed the increase on all other fuels, including green diesel, to 1st May 2021.

As the Deputy will be aware, those who are eligible to purchase green diesel already benefit from a much lower overall rate of excise compared to that applied to auto diesel, with the non carbon component set at a very low 4.7 cent per litre compared to 42.6 cents per litre for the non carbon component of auto diesel excise.

Farmers and agricultural contractors who incur expenses in relation to farm diesel in the course of their trade of agricultural contracting may claim an income tax or corporation tax deduction for those expenses, including any carbon tax charged in respect of the diesel.

When my predecessor increased Carbon Tax in Budget 2012 he made provision for a double income tax relief for farmers to compensate for the increase. This relief continues to apply.