This planned increase in excise duty on fuel will ‘cripple’ businesses TD says tax restoration will drive motorists to the North

Finance Minister Michael McGrath intends to restore excise duties to their former levels, with two increases on April 1 and August 1.

If he does, then from April 1 there will be a 15c per litre difference in fuel prices in the North and in the Republic, according to Fuels for Ireland (FFI).

Independent Sligo-Leitrim TD Marian Harkin – who urged Mr McGrath to postpone duty hikes last September – renewed her appeal yesterday.

‘I told him [Mr McGrath] these increases would cripple filling stations and retailers along the border, lead to business closures, cause job losses and put increased pressure on rural dwellers who have to use their cars more frequently than urban dwellers,’ she said.

‘If the April increase happens, the situation will deteriorate further as the price

Appeal: TD Marian Harkin difference for diesel and petrol at either side of the border will be even greater since the UK government, in its recent budget, postponed increases in excise duties on fuel for a year.’ Ms Harkin said if FFI’s 15c price difference prediction is right, it will drive up inflation – and drive motorists across the border for fuel. The impact in counties such as Sligo, Leitrim, Donegal, Roscommon and other rural counties is much greater than in largely urban areas. ‘The average number of kilometres driven per car per year is 17,500 in Sligo and

Donegal, over 19,000 in Leitrim and Roscommon while the national average is just 16,300 kilometres. This shows that car owners in rural areas drive significantly longer distances to access services, to get to work, school and childcare, and while they are all disproportionately hit by these increases in fuel prices, the biggest hit is being experienced along the border,’ she said.

The planned excise increases are a reversal of reductions introduced in 2022.

‘Up to relatively recently, fuel was one of the only retail products that was cheaper in the Republic than in the North,’ said Ms Harkin. ‘Now, quite the opposite will be the case and the difference in fuel prices will encourage thousands to head north to buy their groceries, alcohol and fuel.’

She added: ‘This is very serious for the local economy along the border. Minister McGrath lives in Cork, which is a long way from the border and the distinctive challenges faced by businesses in the area, but I would ask him to listen to the communities, the business people, and the public representatives in border counties. At the very least, he should match the UK measures and postpone excise increases in fuel for a year.’

Mr McGrath recently said reductions were due to end on August 31, 2022, but this was extended until February 2023 with a phased restoration beginning in June 2023, followed by another restoration in September 2023. He said a final restoration was due to take place on October 31 last year but was postponed until March 31.

He said reductions were worth €1.2billion to consumers, adding: ‘The Government must strike the appropriate balance between providing support and avoiding fuelling cyclical inflationary trends.’ He said average prices are down from €2 a litre in 2022 to €1.85 in October to around €1.69 for diesel and €1.68 for petrol in January 2024, adding: ‘I have no plans to postpone the excise restorations of 8cpl for petrol and 6cpl for diesel, the first phase of half these amounts which is due to commence on April 1 2024.’

‘Cork is a long way from the border’

THE Government has been urged to push back a planned rise in excise duty that will create a 15c per litre difference at border petrol stations amid fears it will ‘cripple’ businesses near the border.