Peter Burke: Explains Temporary Fuel Excise Cuts for Households
Peter Burke outlines the Government's temporary excise reductions on fuel announced this evening, explaining who benefits and why the changes are time-limited. He sets out the package alongside the NORA levy cut, diesel rebate increase and targeted welfare measures to protect vulnerable households.
Summary of measures
Peter Burke details excise reductions that deliver VAT-inclusive per litre cuts of 15 cent for petrol, 20 cent for auto diesel and 3 cent for marked gas oil, together with a 2 cent NORA levy reduction. He reiterates that these measures are part of a broader package including an extended fuel allowance, a 60% increase in the diesel rebate scheme, and a 9% VAT reduction on electricity and heating oil.
Impact on households and supply chains
Burke explains the effects for consumers and supply chains: the measures aim to lessen fuel cost pressures at the pump, underwrite haulage and supply lines, and deliver targeted support for the most vulnerable. He refers to Budget 2026 changes and recent operational payments that expand assistance to households, including the working family payment adjustments.
Constraints and European alignment
The speaker notes legal limits under the Energy Tax Directive and the VAT Directive and places the approach in the context of recent European Council conclusions in Brussels. He stresses the temporary nature of the measures and the Government's right to adjust them as circumstances evolve.
Response to opposition proposals
Peter Burke rejects opposition amendments, arguing they ignore the need for a long-term, economically sustainable approach. He contends tax changes cannot fully offset market-driven energy shocks, and that the Government’s package focuses first on protecting those most at risk while supporting the wider economy.
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Thank you very much, Last Count Comhairle, and I thank all the deputies for their robust engagement on this very important issue this evening. As a Tánaiste has earlier stated, these excise reductions form part of an overall package which the government has designed to provide immediate financial supports to households. The excise rate changes will provide for VAT inclusive per litre reductions of 15 cent per litre for petrol, 20 cent per litre for auto diesel and 3 cent per litre for marked gas oil or green diesel. In addition to the NORA levy reduction of 2 cent, this will provide for overall reductions of 17 cent on petrol, 22 cent on auto diesel and 5 for MGO. While tax changes cannot fully absorb the shocks necessary for the recent energy shocks or indeed market volatility, these changes will lessen the impact of fuel costs to consumers. This measure will be placed for a defined period of time and government reserves the right and the option to adjust these as circumstances evolve. This approach is in line with the European Council conclusions agreed in Brussels last week and with the response of other EU member states. I will reiterate the Tánaiste's affirmation that the opposition amendments cannot be accepted. The proposed amendments disregard the need for a long-term economical sustainable approach. The measures announced today will provide significant mitigation against recent fuel price increases. It is not possible to offset all of the recent increases which are driven by market factors using the tax system. These excise reductions in conjunction with the NORA reduction, the fuel allowance change and the diesel rebate changes which significantly has increased by 60% the DRS has through the changes, again to underwrite the supply lines that run in and which really impact on inflation for many of the groceries that we buy every single week, notwithstanding which if we did not do that it would have a significant impact on consumers. It would also benefit households as with the change in relation to the pumps from the various different measures on the NORA levy and in relation to excise and respecting that we are limited by the rates allowable under the Energy Tax Directive and the VAT Directive which also limit. And also going exactly by what the ESRI said in relation to the most important deciles to benefit from Budget 2026, the extension of the fuel allowance which now covers 470,000 households and which many of the benefits were being operationalised over the last number of weeks, like on the 12th of March where we had 50,000 households because of the change to the working family payment bringing into the net and backdated from the 1st of January which now means that with the additional extension of the four weeks together with the increase in eligibility criteria of over a thousand euro net income for those over 70 ensures that 370 households will benefit and an additional 150 euro per month targeted at the most vulnerable in society. And in my view that is the government's first port of call to ensure that in a time of crisis when you hit a significant shock in the economy that you first protect the most vulnerable in society that's backed up by the ESRI that's what we're going after in the first instance and then wider for the rest of the economy ensuring that you're underwriting the support for the supply chains in relation to our haulage sector as I said an increase of 60% of the diesel rebate scheme as well as those at the pumps and critically other measures like the quarter of a billion euro measure of the 9% reduction in VAT for electricity and oil which ensures that every household in the country will save up to 100 euro per year and other countries in Europe take for example Italy, Spain and the UK are still grappling with changes and many have not went as far as Ireland has already at this juncture with Spain looking to reduce their VAT rate to 10% Ireland already having done 9% on electricity and a critical thing is from our perspective is to ensure that any changes are affordable we do not know the length or duration of this crisis and if we're looking at what the International Energy Agency has put quite clearly on the record that this could be a lot worse than what happened between the two crises of the 1970s together with the challenge from the Ukraine shock which is very significant but one thing we do know over the last number of crises that we faced in this economy from Brexit we met that challenge from a position of strength and we came back stronger when we hit the challenge of the global pandemic we met that challenge from a position of strength and we came back stronger as a government when we hit double digit inflation in November 2022 we also met it from a position of strength and we came back stronger and equally by managing the economy well we will meet this crisis with a position of strength and we will come back stronger as a government and critically protect the most vulnerable along the way thank you minister now
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