Written answers
Tuesday, 30 January 2024
Department of Finance
Tax Code
Johnny Mythen (Wexford, Sinn Fein)
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223. To ask the Minister for Finance in view of the country's high inflation and high interest rates, if he will consider postponing or ditching the proposed increase in excise in both petrol of 8cpl and diesel of 6cpl due to commence on 31 March 2024; and if he will make a statement on the matter. [4257/24]
Michael McGrath (Cork South Central, Fianna Fail)
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As the Deputy will be aware, in 2022 in light of the acute impact rising prices were having on households and business, Government provided for excise rate reductions in the order of 21, 16 and 5.4 cent per litre on petrol, diesel and Marked Gas Oil (MGO) respectively. These temporary reductions were due to end initially on 31 August 2022 but following review and monitoring of fuel prices were extended until February 2023 with a phased restoration beginning in June 2023, followed by a second restoration in September 2023. A final restoration of 8 cent on petrol, 6 cent on auto diesel and 3.4 cent on MGO was due to take place on 31 October 2023. However, in Budget 2024, I provided for a further extension until 31 March 2024 with a phased restoration legislated to occur in two final stages on 1 April 2024 and 1 August 2024. An equal amount of 4 cent per litre on petrol, 3 cent per litre on auto diesel and 1.7 cent on MGO will take place on each date.
The cost of the excise rate reductions from March 2022 until end December 2023 is over €1.1 billion and remains an ongoing cost to the Exchequer while the excise rates are reduced. While I recognise that households and business continue to face challenges, the Government must strike the appropriate balance between providing support and avoiding fuelling cyclical inflationary trends.
To note national average prices have eased considerably from highs of over €2.00 per litre which we saw in 2022. As per the Central Statistics Office Consumer Price Index, average national retail prices of auto diesel and petrol have decreased from approximately €1.85 per litre in October 2023 to approximately €1.71 per litre in December 2023. More recently the European Commission Weekly Oil Bulletin shows that the national average price as of 22 January 2024 was approximately €1.68 for both fuels. In conclusion, I have no plans to change the policy on restoration as announced in Budget 2024.
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