Updated, 09.51

REPORTS THIS MORNING suggest that next week’s Budget could raise carbon taxes by at least a third – making it more expensive to heat your home or fill your car’s petrol tank.

The Irish Times cites government sources which suggest that the tax – which is currently levied at €15 per tonne – could be raised by at least €5 per tonne as part of next week’s financial package.

Harry McGee writes that the tax could even be raised to €25 per tonne, a hike of two-thirds, based on the underwhelming tax receipts reported by the Revenue Commissioners so far this year.

A €5 increase would add around 1 per cent to the cost of a litre of fuel at the petrol pumps – meaning the cost of fuel, currently around €1.50 per litre for both petrol and diesel in the east of the country, would rise by around 1.5c each.

More pressing, however, would be the increase in the cost of home heating – which would rise by around 2 per cent, based on figures supplied by finance minister Michael Noonan two weeks ago.

Assuming that the average home fuel tank has a capacity of around 900 litres, the cost of a tank of kerosene could be hit by around €13.80 – while the cost of a similar delivery of home gas heating oil would be hit by around €15.

All of those extra levies could be doubled if the government was to increase the taxes by €10 per tonne, rather than the expected minimum increase of €5.

These rates do not include the proposed increase in VAT, which will see prices rise by a further 1.6 per cent on top of the carbon tax increases – pushing the net increase on petrol and diesel to 5c per litre, and on the cost of home heating oil to over €30 per tank.

Communications minister Pat Rabbitte will be questioned on the government’s plans for avoiding fuel poverty in the Dáil later today.

The increase in carbon taxes would put further misery on motorists, who are already facing increased motor taxes in next week’s Budget.

Drivers “putting lives at risk” by stopping on motorway

Motor tax will rise in Budget, minister confirms