Cost of living and fuel taxes
Mattie McGrath attacked the Government's handling of the cost-of-living crisis, focusing on record energy taxes and planned changes to fuel reliefs. The Taoiseach replied that price rises were driven largely by international factors, though taxes also fund public services, and he defended the carbon tax and related supports.
Is the Government trying to address the cost-of-living crisis or is it trying to bankrupt the public? As far as I and most people can see, it is the latter. The facts, which have been confirmed to me in reply to a parliamentary question to the Minister for Finance, show that the Government collected a record €3.75 billion in energy taxes last year. Meanwhile, during that same period, the Government gave out minimal energy relief to people. The Government's decision yesterday to extend the minimum excise relief is like throwing breadcrumbs to a flock of crows after starving them. It is not enough. We need relief from those punitive taxes that are crippling our public. The figures expose the Government's exploitation of our citizens and the energy price crisis. The Government is gaining profits from the difficulties of ordinary people through taxes that are bordering on criminal. The plain facts of the matter are that this Government's energy tax policies are nothing but highway robbery. They are taking from the poor and giving to the Government's own coffers to give out this, that and the other. Last year, the Government collected a record €3.75 billion in energy taxes, representing an increase of nearly €500 million or 15% on the previous year. These are staggering figures in the middle of a cost-of-living crisis. It gets even worse when you consider carbon tax and energy VAT income, which surged by almost 31%, increasing from €1.681 billion in 2021 to €2.196 billion in 2022. The figures are there. They are Department of Finance figures supplied by the Minister. It is almost criminal to raise VAT on carbon tax revenues from fuel during a cost-of-living crisis. People have to heat their homes and have to try to get to work and keep the wheels of industry going. That is why the Rural Independent Group submitted a motion last year for a zero rate of VAT and carbon tax until this cost-of-living crisis has passed us. It was like Pontius Pilate on Good Friday. The Government just voted it down - Fine Gael, Fianna Fáil, the Green Party and some Independents. This Government says it has been prioritising the well-being of the Irish people but it thinks the people are ATMs, that it can reach in, put in the card and take more and more. I can tell the Taoiseach they have no more to give. They are suffering. They are in agony. They are trying to live, put clothes on their children's backs and feed them and send them to school. The Government keeps hitting the weakest and the lowest. Ordinary working families and small businesses are completely crucified and they get nothing from the Government only a threat that it is going to go back up in October to the full taxation on energy, whether it is diesel, petrol, home heating oil, agrifuel or anything else. It is more punitive suffering.
Comment on this
At the outset, I want to say once again that the Government appreciates that the cost of living is very high, that inflation remains high and that prices are still rising. We understand that the high cost of living is hurting people and families and making it very hard for a lot of businesses to operate in the State. This is driven largely by factors outside our control. Of course we would like to see energy prices being much lower but we are a price taker when it comes to electricity, gas, petrol and diesel, which are almost all imported from abroad. Prices have been driven up internationally by a number of factors, not least the war in Ukraine. We are acting to help. There was €600 taken off people's bills in the form of the electricity energy credit, with €200 still to come off people's bills in March and April. The 9% VAT rate is the lowest VAT rate we have ever had on electricity and gas and it was announced yesterday that we are going to extend it until the end of October. We have reduced the excise on both petrol and diesel. It was due to go up at the end of the month but we have announced now that it will not even start going up until June. We also announced yesterday that we would improve the temporary business energy support scheme, TBESS, so more businesses will qualify, that they would qualify for more financial support and that it would be backdated to September. As somebody who represents a rural constituency, I know the Deputy will welcome the fact that there will now be a new grant scheme for businesses that are not on the gas network and use liquefied petroleum gas or kerosene instead. The Minister for Enterprise, Trade and Employment, Deputy Coveney, is putting that scheme together as we speak. There will be a debate on this and a vote in the Dáil. The vote will be to extend the 9% VAT until the end of October and not to put up the cost of petrol and diesel at the end of this month. I hope the Deputy will vote with the Government on that.
Comment on this
I do welcome the new TBESS because the first one was way too restrictive. A person on anything other than town gas could not claim for it. I welcome the VAT rate for hospitality; of course I do.
I do not welcome the fact the Government will start taking off the excise exemptions after June and will be charging people extra for fuel. The Government is playing a three card trick here. The wholesale cost of oil is lower than it was in the pre-war period. The war is blamed for everything. It should stop the blame game there. It is the Government's punitive taxes that are causing the price of oil to be so high; it is nothing else, including international factors. Every other country in Europe - I have a list of them - have had windfall taxes but the Government refused to have them. The Government does everything for the corporate big people but nothing for the daoine beaga, the small people, because the Government parties are not interested in them and never were. It is shameful that the Government will try to quote those figures glibly here. We welcome the bits and pieces but the Government has a lucky bag here and if one does not vote for parts of it, one will not get the rest. It is a lucky dip, mar dhea, and we are threatened if we do not vote for it.
The Government's carbon tax cost every man, woman and child in this country an extra €160 last year. This year it will be €180 and next year it will be €210. That is what the Government is doing to help people. The Government is robbing and fleecing the people and is pretending to throw them crumbs. It is a mockery.
Comment on this
A number of different factors are at play when it comes to the price of fuel but it is just not correct to say that international factors have nothing to do with it and that it is all about tax. That is demonstrably not the case.
One need only go north of the Border to look at the price of petrol and diesel there, or go to the UK or to most parts of western Europe-----
Comment on this
-----but perhaps not to all parts of Europe. One will see what the price is in the Netherlands, Denmark or Germany.
This is absolutely driven by international factors and we are price-takers in that regard. Tax is an element of it and we have taxes for a reason. They pay for education, healthcare, pensions, housing and all of those things we need. That is why we have taxes.
When one looks at the price of a barrel of oil, for example, one needs to bear in mind currency movements. Oil tends to be priced in dollars. Sometimes North Sea Brent crude is priced in sterling. If the euro is weaker than other currencies, that also impacts it. One cannot just look at the price of oil-----
Comment on this
-----and one needs to look at that too. I stand over the carbon tax. This tax is ring-fenced and is being given back to people for retrofitting and green schemes for farmers.