Dáil Éireann Debate, Tuesday - 12 February 2019
147. Deputy Timmy Dooley asked the Minister for Finance the estimated cost of an increase in fuel allowance for those who qualify in order to neutralise the impact of a €5, €10, €15 and €20 increase in the carbon tax; and if he will make a statement on the matter. [6267/19]
View answerThe Fuel Allowance is a means-tested payment under the National Fuel Scheme to help with the cost of home heating during the winter months. It is paid to people who are dependent on long-term social welfare payments and who are unable to provide for their own heating needs. Only one Fuel Allowance is paid to a household. The current weekly rate is €22.50 and is paid for 28 weeks from the first week of October until the second week of April.
According to the Department of Employment Affairs and Social Protection, the average number in receipt of the national fuel allowance is 369,800.
In 2018 the ESRI undertook research on the environmental, social and economic impacts of potential carbon tax increases. To examine the distributional impacts, households were assessed by income deciles from poorest to richest. The ESRI's estimated weekly monetary impacts of carbon tax increases of €5, €10, €15 and €20 respectively are as set out in the table below in relation to the two lowest household income deciles (HHI being the lowest).
|
- |
Monetary Impacts |
Monetary Impacts |
Monetary Impacts |
Monetary Impacts |
|
Carbon Tax Increase |
€5 |
€10 |
€15 |
€20 |
|
Impact on HH1 |
€0.45 |
€0.91 |
€1.38 |
€1.87 |
|
Impact on HH2 |
€0.62 |
€1.26 |
€1.92 |
€2.60 |
The full report can be accessed at: https://www.esri.ie/system/files?file=media/file-uploads/2018-10/RS79.pdf
Decisions on tax policy take place every year as part of the annual budgetary process and decisions in relation to carbon tax policy will be informed by available research and analysis, which includes the social and economic impacts of any increases in the carbon tax as well as measures to mitigate such impacts. The Environmental Taxes paper prepared annually for the Tax Strategy Group contains analysis on the carbon tax and this helps inform subsequent budget decisions.
