Minister says carbon tax checks will have to increase

Checks to ensure carbon taxes are being paid will have to be “ramped up” according to a junior minister.

Local TD Pauline Tully (SF) told the Dáil that local enterprises are seeing their “business go up the swanny” because of cross-border trade in fuels.

Differences in fuel prices north and south have been highlighted since the introduction of the carbon tax here.

Local retailers have criticised the move, claiming it’s driving customers to the north where prices are cheaper.

Deputy Tully claimed some northern companies are advertising their products on social media and enabling people south of the border to order and receive deliveries.

“People can ring a number, pay online and get a large amount of fuel - tonnes perhaps - delivered to their door on a pallet. There’s no carbon tax or VAT being paid on this. The prices that they are being charged show this could not be the case because they are undercutting the prices merchants here have to pay in order to pay the carbon taxes and VAT,” she said.

The carbon tax was introduced in Ireland in 2010 and applies to kerosene, diesel, petrol, fuel oil, natural gas and solid fuels. The tax will increase by €7.50 per tonne every year until 2030.

Following Budget 2022 earlier this month, the tax now stands at €41 per tonne of carbon dioxide emitted.

The Government has said the increase will encourage people to switch to low-carbon alternatives but critics say the poorest are the ones who are being hit the hardest as they cannot afford to transition. Deputy Tully called for Revenue to be given additional powers and greater resources to “track and trace all solid fuels supplied on the Irish market”. She also said a dedicated phone line to report people not paying carbon tax should be set up.

Minister of State for Skills and Further Education, Niall Collins, who was responding to the topical issue question in the Dáil, said more will need to be done to tackle the problem of the cross border trade.

“Compliance checking will have to be ramped up”, he said. “Revenue do carry out enforcement operations. They carry out cross-border, multi-agency enforcement operations. They also carry them out in conjunction with local authorities.”

But he said the pandemic had impacted on the number of checks being carried out.

Deputy Collins said there are legitimate and valid concerns around the evasion of carbon taxes but Revenue is aware of the issues.