Dáil Éireann Debate, Tuesday - 14 December 2004
147 Mr. P. McGrath asked the Minister for Finance his plans to reduce excise duty on rapeseed oil and other such products in the context of encouraging alternative energy sources, as is the practice in other EU countries; and if he will make a statement on the matter. [33255/04]
View answerThe Deputy may be aware that section 98(a) of the Finance Act 1999, as inserted by section 50 of the Finance Act 2004, provides for the introduction of a scheme for excise tax relief for biofuels. The purpose of the scheme is to allow qualified and conditional relief from excise of biofuel used in approved pilot projects for either the production of biofuel or the testing of the technical viability of biofuel for use as a motor fuel.
The details of the scheme, which includes pure plant oil, biodiesel and bioethanol, are being finalised in conjunction with the Department of Communications, Marine and Natural Resources. The European Commission has confirmed that the scheme would represent a State aid and consequently its approval is required. The EU energy tax directive 2003 envisages such tax relief and the Commission has approved schemes for excise relief of biofuel in other EU member states. My Department, together with the Department of Communications, Marine and Natural Resources, has had a number of meetings with European Commission officials in respect of this and it is expected that a formal application for Commission approval will be made shortly and, assuming approval is granted, the necessary commencement order will then be signed.
