Carbon tax will double to €30 per tonne

 

ENVIRONMENT:THE €15 per tonne carbon tax, introduced for the first time in the 2010 budget, is to double over the life of the plan to €25 per tonne in 2012 and 2013 and €30 per tonne by 2014.

Originally touted by Minister for Environment John Gormley as a “revenue neutral” measure, with the funds used to lower carbon emissions, support energy efficiency and alleviate fuel poverty, the plan states it will now contribute €330 million to the “overall correction”.

The tax applies to fossil fuels, including petrol, diesel, coal, turf fuel oil and gas. The plan does not estimate the increased costs on any of these products. However, when the €15 tax was applied to petrol and diesel from last December, it added approximately 5 cent to the cost of a litre.

The tax on home heating fuel was not implemented until last May. The ESRI estimated the changes would cost households up to €156 per year. A bale of peat briquettes increased by about 39 cent and a 40kg bag of coal by €1.79. Natural gas costs increased by about 6 per cent.

In addition to the financial benefits of doubling carbon tax, the plan stresses the environmental gains stating the upward adjustment in tax would cut emissions.