Patricia Ryan
Ceist:193. Deputy Patricia Ryan asked the Minister for Finance his plans to address the rising cost of home heating oil; and if he will make a statement on the matter. [33405/22]
Amharc ar fhreagraThursday, 23 June 2022
Ceisteanna (193)
Freagraí scríofa
The Government is acutely aware of the increase in consumer prices in recent months, especially the increase in fuel and other energy prices including home heating oil, and for this reason it designed a package of measures to alleviate the impact of increased energy prices on households.
The package of measures includes:
- an energy credit of €200 including VAT, estimated to impact just over 2 million households
- a lump sum payment of €125 on the fuel allowance paid to 390,000 recipients
- an additional lump sum payment of €100 paid to all households in receipt of the fuel allowance
- a temporary reduction in public transport fares of 20% from the end of April to the end of the year. This will impact approximately 800,000 daily users of Bus Éireann, Iarnród Éireann, Dublin Bus, Go Ahead, Luas, DART and Local Link services.
- a reduction of the Drug Payment Scheme from €144 to €80 benefitting just over 70,000 families
- the working family payment budget increase was brought forward from 1 June to 1 April
- reduced caps for multiple children on school transport fees to €500 per family post primary and €150 for primary school children.
This package of measures built on measures already introduced in Budget 2022, provides support to all domestic electricity users via the energy credit and also provides targeted support to vulnerable households via the welfare system. Low income households have received an overall increase of 55% in Fuel Allowance support provided during the most recent Fuel Allowance season as compared to the previous season taking the €5 increase in the weekly payment introduced as part of the Budget last October, the €125 lump sum payment provided earlier this year together and the €100 extra May payment.
The Government announced a temporary reduction in the excise duties charged on petrol, diesel and marked gas oil. This measure, to the value of €320 million, was introduced with effect from 10 March reducing the VAT inclusive excise duty on petrol, diesel and MGO by 20, 15 and 2 cent per litre respectively. These reductions mitigate the cost of a fill of a 60 litre tank by some €12 for petrol and €9 for diesel. This assists all transport users, rural and urban, including commuters, business and farmers. These measures have been extended to 11 October 2022, with an additional 3 cent reduction for MGO. The extended measures will cost a further €97m.
In addition to these measures, the Government took the decision to reduce the rate of VAT on the supply of gas and electricity from 13.5% to 9% until October 31, 2022, costing an estimated €46m and resulting in estimated annual savings of €49 on gas and €69 on electricity bills for households. In relation to VAT on home heating oil, the position is that a reduced rate of 13.5% VAT currently applies to it. This rate is applied on the basis of a historical derogation from the standard VAT rate that should apply. The rate applied to domestic energy supplies such as oil and solid fuels is 13.5%. As this is a ‘parked’ rate it cannot be reduced below 12%.
The Government is of course very much aware of concerns regarding the ongoing impacts of increased energy prices and Government Departments will continue to monitor energy markets and consumer prices to ensure evidence based policy guidance in advance of Budget 2023.
In conclusion, I propose to keep the taxation of fuel including home heating oil under review as part of preparations for Budget 2023.