Pearse Doherty (Donegal, Sinn Fein)
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115. To ask the Minister for Finance if it is his intention to legislate for carbon taxes to be ring-fenced, as was committed to in the 2020 Programme for Government. [5154/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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While legislation is not currently in place for Carbon Taxes to be ring-fenced, the proceeds from Carbon Taxes are allocated for measures related to the Just Transition and climate action. This includes part-funding the roll out of a national retrofitting programme, targeted welfare intervention measures and funding for greener farming practices.

Budget 2025 provided for a €951 million allocation toward this end, an additional €163 million on 2024’s allocation.

The approach to Carbon Tax revenue expenditure has been informed by academic findings of an ESRI study. Ongoing analysis undertaken using SWITCH, the ESRI tax and benefit model, finds that households in the bottom five income deciles are materially better off as a result of the social protection measures in Budget 2025 funded by the increased carbon tax.

The 2025 Programme for Government commits to continue to use Carbon Tax revenues to fund social welfare measures, agri-environmental schemes and retrofitting.

I am satisfied that the current approach is appropriate to give full effect to this commitment and to ensure that those who are most vulnerable receive targeted support, thus making the transition away from fossil fuels fair and equitable.