Dublin: The Irish government has signalled plans to proceed with an increase in carbon tax as part of a broader €750 million support package aimed at easing rising fuel costs, though the move has been deferred until the October budget.
Simon Harris confirmed that the proposed tax hike—originally scheduled to take effect next month—will now be reviewed later this year. The decision to delay the increase is expected to result in a €22 million loss in government revenue.
Currently, the carbon tax stands at €71 per tonne for petrol and diesel, and €63.50 per tonne for other fuels such as home heating oil. The planned increase has been postponed following nationwide protests over the rising cost of living, with the government acknowledging that this is not the right time to introduce additional financial burdens on households.
Political Debate Intensifies
The decision has drawn criticism from Roderic O’Gorman, who argued in the Dáil that delaying the increase undermines years of political-effort to implement carbon pricing. He warned that postponement could lead to further pressure to defer the measure again during the October budget discussions.
In response, Harris emphasised that the delay is part of a broader effort to support households during a period of economic strain. He noted that while tax increases are essential for government revenue, they must be balanced against the immediate needs of citizens.
Harris also reassured that the postponement would not impact funding for key environmental initiatives, including the Climate Action Fund, retrofitting programmes, and fuel support schemes.
The carbon tax framework was originally introduced prior to global disruptions such as the war in Ukraine and escalating tensions involving Iran, which have significantly influenced global energy markets.
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