Dáil Éireann Debate, Thursday - 14 July 2022
18. Deputy Peadar Tóibín asked the Minister for Agriculture, Food and the Marine if his Department has undertaken any study to measure the increase in costs for green diesel and the burden that this is having on farmers. [38213/22]
Amharc ar fhreagraI am very conscious of the impact on the agri-food sector of increased input costs, and particularly price rises in the energy sector, which have been amplified by Russia’s illegal invasion of Ukraine. I have worked to deliver measures and supports for our farm families who have been impacted by the increased costs of inputs as a result of the illegal invasion of Ukraine.
I meet with stakeholders on an ongoing basis to discuss the impact of the Ukraine crisis on Irish agriculture and supply chains. Since the invasion of Ukraine started, I have announced a number of measures, valued at €91 million, to assist the agri-food sector. These targeted measures will help Irish farmers at a time of escalating costs and build resilience against the expected impact of the situation in Ukraine.
While primary responsibility for the taxation of fuel lies with the Minister for Finance, I continue to work closely with him to ensure that the tax code reflects the Government’s priorities for the agri-food sector.
As the Deputy may be aware, gas oil that qualifies for a reduced rate of Mineral Oil Tax is marked green and is usually referred to as Marked Gas Oil (MGO), green diesel or agricultural diesel.
Mineral Oil Tax is comprised of a non-carbon component and a carbon component. Following reductions applied by the Minister for Finance to the non-carbon component of the tax this year, the current rate of Mineral Oil Tax on agricultural diesel is €111.14 per 1000 litres. This compares very favourably to the current rate applied to auto diesel which is €405.38 per 1000 litres.
It should be noted that those who incur expenses in relation to farm diesel in the course of farming or the trade of agricultural contracting may claim an income tax or corporation tax deduction for these expenses, including any carbon tax charged in respect of the diesel.
I also note that Section 664A of the Taxes Consolidation Act, as amended, provides further relief on expenditure incurred by farmers in respect of an increase in the carbon tax on farm diesel.
I continue to engage with all our stakeholders and continue to work across Government, and with our European partners, to respond to this crisis, using all of the tools at our disposal. I am taking a very proactive approach to the crisis in Ukraine.
We must protect our agri-food sector and farm families through this period of significant upheaval.
