I am taking it that the Deputy, in referring to “carbon tax”, is enquiring about the application of Mineral Oil Tax (MOT) to fuel used for fishing boats and for commercial freight and passenger vessels. MOT is an excise duty and is comprised of a carbon and a non-carbon component. The carbon component is often referred to as carbon tax, but it is only one part of the overall tax (MOT) that applies to mineral oils and other fuels used for motor and heating purposes.
Ireland’s excise duty treatment of fuel used for motor and heating purposes is based on European Union law as set out in Directive 2003/96/EC on the taxation of energy products and electricity, commonly known as the Energy Tax Directive. Under this Directive, Member States are obliged to tax motor and heating fuels. However, Member States must exempt from taxation all fuels that are used for navigation within Community waters, other than fuels used for private pleasure navigation. This means that fuels used for sea-fishing and for commercial freight and passenger vessels must be exempt from taxation under the Directive.
In line with Article 14 of the Energy Tax Directive, Ireland’s MOT legislation, set out in Finance Act 1999, provides for fuels used for the purposes of commercial sea navigation, including sea fishing to be exempt from excise duty. Section 100(2)(a) of Finance Act 1999 provides for a full relief from MOT for fuel used for commercial sea navigation, including sea-fishing. I am advised by Revenue that, subject to conditions, this relief is operated by way of remission or repayment through Revenue’s online services. Full details on the operation of this relief are available on Revenue’s website at: https://www.revenue.ie/en/companies-and-charities/excise-and-licences/mineral-oil-tax/remission-or-repayment-of-mot-on-mineral-oil-used/index.aspx.