MOTORISTS WILL FACE a hike in the cost of refuelling their vehicle, as diesel and petrol prices are set to rise from tomorrow.
Petrol prices will go up by 5c per litre, and diesel will rise by 7c, as the government rows back some of the cuts to excise duty it implemented last year.
The cost of fully refuelling a vehicle will go up by €3.50 for a 50 litre tank to €4.90 for a 70 litre tank.
The government cut excise duty on fuel by 20c in March of last year as a response to a spike in prices at the pump driven by Russia’s invasion of Ukraine and general fuel shortages.
On 1 June of this year the Government rowed back this cut by 6 cent for petrol and 5 cent for diesel. Tomorrow marks the latest increase in prices.
The final reversal is set to come on 31 October, when prices will go up by 8 cent for petrol and 6 cent for diesel.
Speaking to RTÉ News on Tuesday, Finance Minister Michael McGrath said that the excise increase is already “locked in” and will be going ahead, but the Government will keep the final increase under review.
Calls to halt
Tomorrow’s planned increase has been criticised by independent politicians and farmers’ groups. Independent TD Mattie McGrath said the increase “is just plain wrong”.
“We need action now to help struggling Irish families facing an ongoing cost of living crisis,” he said.
With back-to-school expenses, groceries getting pricier, and mortgage rates going up, families are really struggling. Adding fuel tax hikes to this mix is just plain wrong.
The Irish Farmers’ Association said that it was “unconscionable” that the Government would proceed with the increases in the context of the cost-of-living crisis.
“I am calling on Minister Michael McGrath to reconsider the timing of this increase in excise duty and announce an indefinite extension immediately,” said Rose Mary McDonagh, chair of the Farm Business Committee.
VAT increase
Meanwhile, prices are also likely to increase in pubs and restaurants as the 9% VAT rate for hospitality ends today, increasing to 13.5%. The VAT rate applies to the price of food in hospitality settings.
It was cut from the normal rate in Budget 2021 to help struggling hospitality businesses weather the Covid-19 crisis. The rate was set to go back to normal in August of last year, but was extended by Government.
It was also set to rise earlier this year, but the government again extended the rate until today. Hospitality groups lobbied strongly to once again have the reduced VAT rate extended, but there was no movement on Government on this occasion.
“We are very disappointed that the Government has decided to add to inflation with this unnecessary increase in taxation on food,” said Donall O’Keeffe, Chief Executive of the LVA.
The 9% VAT rate on food purchased in hospitality settings was at the right level, both from the point of view of domestic consumers and attracting tourism.
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