Dáil Éireann Debate, Wednesday - 24 September 2008
270 Deputy James Bannon asked the Minister for Finance the measures he has put in place to replace the excise duty refund which amounts to 34.5 cent per litre of diesel for public transport services (details supplied); and if he will make a statement on the matter. [29605/08]
Amharc ar fhreagra271 Deputy James Bannon asked the Minister for Finance his views on a proposed alternative to the fuel excise refund which is non-tax based and should therefore comply with the EU state aid legislation as operated in the UK to support public transport services; and if he will make a statement on the matter. [29606/08]
Amharc ar fhreagra280 Deputy Fergus O’Dowd asked the Minister for Finance his plans to introduce a replacement fuel rebate scheme for school transport operators; and if he will make a statement on the matter. [30008/08]
Amharc ar fhreagraI propose to take Questions Nos. 270, 271 and 280 together.
The 2003 EU Energy Tax Directive contained special derogations that allowed specific excise duty reliefs to be applied in a number of Member States. In Ireland's case, these derogations allowed for reduced rates of excise duty for fuel used for public transport services, including school transport services. These derogations expired on 31 December 2006. Ireland, along with other Member States, sought retention of its derogations beyond that date, but the European Commission, who is the deciding authority, refused such requests.
Consequently, the Finance Act 2008 made the legislative changes to withdraw the relief in respect of fuel used for public passenger transport vehicles. The relief will be withdrawn with effect from 1 November 2008 and the appropriate full excise rates will apply from that date.
The Department of Transport and other relevant line Departments, in conjunction with my Department, have examined the implications of this. They have explored alternative mechanisms that might be used to direct Exchequer resources toward such services from that date, subject of course to compatibility with competition and EU State Aid requirements. Any such expenditure decision on this matter will be made in the context of the Estimates process now underway.
