Brendan Smith (Cavan-Monaghan, Fianna Fail)
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254. To ask the Minister for Finance if he will reduce the level of excise on fuel products due to the severe pressures on many households due to the rising costs of living; and if he will make a statement on the matter. [7363/22]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy is aware, the final retail price of fuel is determined by a number of factors including the costs of production, distribution, global market factors, international exchange rates, taxation, wholesale market contracts as well as individual retail pricing policies.

The current inflationary trend in fuels is driven by international market factors, primarily by rising demand due to the economic recovery with secondary factors of rising EU ETS allowance prices, weather patterns and gas supply levels in Europe also contributing to rising costs.

I am acutely aware of the severity of the financial impact that this is placing on Irish households. To alleviate this impact, all households will receive an electricity credit in 2022. The Government is also discussing a package of measures which will further alleviate this burden for those most vulnerable to fuel poverty.

Targeted welfare measures such as those recommended by the ESRI in their October 2020 commissioned research paper provide the most efficient means of protecting those most vulnerable to fuel poverty rather than broad based measures such as excise reduction.

Over the longer term, the Government has committed to significant funding of residential energy efficiency measures and investment in alternative fuels which will reduce our reliance on fossil fuels and lower the cost of heating our homes.