There have been strong calls for the Government to delay the scheduled fuel cost increases which are set to be bad news for motorists.
The Government are being accused of “punishing motorists” as drivers are facing several diesel and petrol cost hikes in the coming months.
Back in March 2022, the coalition reduced excise duty on motor fuels in a bid to curb surging prices. This inflation was linked to the war in Ukraine.
After postponing the lifting of these cuts last year, however, that is now set to take place this year in two equal instalments.
The first will happen on 1 April 2024, with The Irish Independent reporting that the cost of a litre of petrol and diesel will rise by 5c and 4c respectively once VAT is added in.
This is before similar rises will take effect on 1 August, after which time excise duty levels will be restored.
While there had been hopes that these increases would be delayed again, Taoiseach Leo Varadkar has put a dampener on them.
He told reporters this week: “In relation to the excise cuts, they were temporary and there to reflect the fact that petrol and diesel prices had exceeded €2 a litre at one stage so Minister [Michael] McGrath set out in the Budget how those excise duty cuts would end and there is no change to that and it will be as it was set out in the Budget.”
The Independent also reports that motorists are set for a third hike in petrol and diesel costs in this coming October’s Budget. This is as a planned rise in carbon tax is anticipated to add around 3c per litre.
On top of this, the outlet states that a fourth hike in motor fuel costs is expected at the beginning of January 2025.
This is down to a rise in the biofuels component of transport fuels, which is set to add between 1c and 2c to the cost of both petrol and diesel.
All together, these four rises are likely to add around 15c to the cost of a litre of petrol and around 12c to a litre of diesel, according to the newspaper.
Speaking to the outlet, Consumers’ Association of Ireland chairman Michael Kilcoyne claimed that the coming increases are “just punishing motorists and pushing up the cost of living” and called on the Finance Minister to postpone the excise duty hikes.
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CEO of Fuels for Ireland Kevin McPartlan, meanwhile, expressed concern in a statement that the excise duty increases could have a negative impact on forecourt retailers near the Republic of Ireland-United Kingdom border.
He explained: “There could be a 15 cent a litre difference in the price of petrol between retailers on both sides of the Border by August. Undoubtedly, this would mean that retailers in Counties Louth, Cavan, Monaghan, Leitrim, Sligo and Donegal would be under such huge pressure that many could go out of business.
“During the cost-of-living crisis, the Irish Government made the correct decision to reduce excise duties on fuel. The UK Chancellor of the Exchequer made a similar decision. Ireland intends to increase excise duties to their previous levels with two increases on April 1st and August 1st. However, just last week in his Spring Budget, the UK Chancellor of the Exchequer, Jeremy Hunt, announced that the UK will postpone any increases for the next 12 months.
“This will lead to a huge difference in prices at the pump with retailers south of the border at an extreme disadvantage. Forecourt operators in border constituencies are expected to face a substantial reduction in demand. With many retailers situated near the Border, the price gap between Northern Ireland and Ireland will drive consumers across the Border, posing a grave threat to the viability of local forecourts.
“Secondly, the Irish Exchequer stands to suffer a considerable loss in income as fuel sales plummet due to cross-border purchases. This reduction in State revenue contradicts the intended goal of increasing excise duty.
“Fuels for Ireland urges the Minister for Finance and the Government to reconsider the decision to increase excise duty and to postpone it in light of the UK’s actions.”
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