LAST UPDATE | 29 Jun

COALITION LEADERS HAVE decided to extend the current excise reductions on petrol and diesel until 1 September 2026.

The decision will be signed off on by cabinet on Tuesday. 

Taoiseach Micheal Martin, Tánaiste Simon Harris and Minister of State Sean Canney met on Monday evening to discuss the matter. 

It was decided that the current reductions on excise duty will be maintained until 1 September, before the previous rates are gradually restored over the following four months.

Extending the package comes at a cost of €270 million. 

There were signals from the Taoiseach and Tánaiste last week that a phased rollback could be the preferred option, with a gradual reversal of the supports over a number of stages.

However, meeting this evening, coalition party leaders decided to push out any changes until September. 

Both Martin and Harris indicated in recent days that they wanted to ensure no “immediate cliff-edge” at the end of July when the excise cut of 32c a litre in diesel and 27c for petrol were due to finish.

The meeting this evening comes as global oil prices have fallen to levels not seen since before the US-Israeli war on Iran started in February.

Speaking this morning, Minister for Education Helen McEntee said the government still needed to remain “agile” given ongoing uncertainty in the Middle East, but acknowledged that fuel prices have fallen significantly since the emergency measures were introduced.

“My own view is that these were introduced at a very difficult time. They were introduced as a temporary measure,” McEntee said.

“It’s always difficult when you introduce something on a temporary basis to then remove it… but we need to be open to a number of different options as to how we either remove, take down or adjust these payments.”

Sinn Féin had argued the cuts should remain in place until the budget.

Aontú, which is due to bring a Dáil motion on Wednesday calling on the government to abandon any plans for the excise cuts to be reversed, said in a statement on Monday evening that the government’s reversal on the proposed fuel excise hikes is positive news. 

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“It only comes after significant pressure from ourselves and others. The key issue remains. Ireland is an excessively expensive country for energy. It’s bad for families, it’s bad for business and it’s bad for farmers. Given the current price trajectory for fuel, any efforts to jack up excise on petrol and diesel by 27c and 32c in September will be opposed by Aontú,” said the party’s statement. 

The Irish Road Hauliers Association (IRHA) meanwhile has called on the government to cut the cost of doing business for Ireland’s transport industry in tandem with any future moves to “restore punitive fuel taxes”.

IRHA president Ger Hyland said that additional costs hauliers are facing “will ultimately make their way onto the supermarket shelf and will mean higher food and goods prices”.

“Government need to re-evaluate the costs, regulatory and compliance burdens they are putting on small businesses, in particular in rural Ireland,” Hyland said.

“From higher tolls, to increased Dublin port charges, those costs are ultimately a cost on the consumer.”

With reporting by Andrew Walsh