The Irish Government has agreed to phase out temporary excise duty cuts on petrol and diesel over four months, with the changes expected to begin in November and be completed by the end of February.
Tánaiste and Minister for Finance Simon Harris secured Cabinet approval for the plan, which is intended to give households and businesses greater certainty while global energy markets remain volatile.
The Government announced last week that planned increases in fuel excise duty for September and October would be postponed because of rising prices.
Under the original schedule, petrol would have become 9 cents per litre more expensive, while diesel would have risen by 10 cents, pushing its price above €2 per litre. Fuel prices at similar levels contributed to major protests across Ireland last April.
The Government will now introduce the excise increases in four stages between November and February rather than applying the full increases immediately.
Harris said the approach would provide continued support for consumers while allowing the State to manage its finances responsibly.
The reduction in the National Oil Reserves Agency levy will also be extended until the end of October under proposals from Transport Minister Darragh O’Brien. A diesel rebate scheme for transport operators will remain in place until the end of December.
The Dáil has been recalled from its summer recess and will sit for more than an hour on Friday to consider the financial resolution needed to implement the changes.
Sinn Féin has said it will not support any measure that increases fuel prices after October. The Social Democrats and Labour are expected to support the Government’s decision to delay the increases, although both parties are seeking longer-term measures to reduce energy costs.
Social Democrats TD Jennifer Whitmore said her party would support the proposal but argued that electricity prices were also placing heavy pressure on households.
She said 328,000 people were currently behind on electricity bills and called for a targeted €400 energy credit for households earning less than €70,000 a year. The party estimates the measure would cost about €450 million and has suggested funding it through measures involving data centres and the bank levy.
Whitmore also called for larger grants for solar panels as part of a “solar-for-all” policy, saying it could reduce household electricity costs.
The fuel industry welcomed the temporary extension but called for greater scrutiny of future tax decisions.
Fuels for Ireland chief executive Kevin McPartlan said the extension provided short-term certainty but argued that future increases should be based on current fuel prices, market conditions and consultation with industry.
He said global factors such as geopolitical developments, refining capacity and exchange rates could change rapidly, making fixed timetables difficult to maintain.
“Changing the dates on the calendar is not enough,” McPartlan said. “We need to change the way these decisions are made.”
