Vol. 373 No. 13
asked the Minister for Finance his views that the tax on hydrocarbon oils levied on the ESB, at twice the rate levied on other companies, is unfair and an additional tax on electricity consumers which raises the cost of electricity; if the Government intend to reduce the tax to the same level as charged to private industry; and if he will make a statement on the matter.
85.
asked the Minister for Finance the plans, if any, he has to reduce the £16 per tonne hydrocarbon tax on fuel oil used by the ESB in order to reduce the cost of electricity to consumers; and if he will make a statement on the matter.
I propose to take Questions Nos. 84 and 85 together.
I assume the Deputies are referring to the rate of excise duty on residual fuel oil used by the ESB which is 7p per gallon and the rate of excise duty on the same oil used by industry which is 3½p per gallon.
On 1 December, 1981 the rate of excise duty on residual fuel oil used by industry was reduced. This reduction was intended to be of direct benefit to manufacturing industry and accordingly it was not extended to cover the residual fuel oil used by the ESB.
In the present very difficult budgetary situation any reduction in this tax would have to be compensated for elsewhere. It is not a question, therefore, of whether this amount of tax should be raised but one of where it should be sought and the Government consider that the present mixture of taxes, including the excise duty on residual fuel oil used by the ESB, is necessary in present circumstances. It is not proposed at present, therefore, to reduce the rate of excise duty on residual fuel oil used by the ESB.
It is relevant in this context to point out that consumers of electricity benefit from the fact that electricity is not subject to VAT. This is in contrast with the situation of other fuel users since all other fuels are subject to VAT.
