Dáil Éireann díospóireacht -
Tuesday, 28 Feb 1995

Vol. 449 No. 7

Written Answers. - Production of Biofuel.

Trevor Sargent

Ceist:

69 Mr. Sargent asked the Minister for Finance the plans, if any, he has to provide a financial incentive towards the production of biofuel which, if put in place during the course of 1995, would promote increased production in 1996. [2497/95]

Minister for Finance (Mr. Quinn)

I presume the Deputy has taxation incentives in mind.

At present, substitute fuels, including biofuels, are not liable here to hydrocarbon oil excise duty. However, additives or extenders, which could include substitute fuels, that are added to hydrocarbon oils are liable to duty at the rate applying to the oil in question.

Under EU Directive 92/81/EEC, as amended, products which are added to, or substituted for, hydrocarbon oils and used as motor fuel are taxable as motor fuel. However, member states may apply total or partial exemptions or reductions in the rate of excise duty to mineral oils used in the field of pilot projects for the technological development of more environmentally-friendly products and in particular in relation to fuels from renewable resoures.

No agreement has been reached at EU level in regard to a Commission proposal specifically relating to the taxation of biofuels. The domestic position regarding the taxation of biofuels is under review.