Irish cabinet to cut excise duty on petrol and diesel

theguardian.com:

The Irish cabinet has agreed to slash excise duty on petrol from midnight, piling the pressure on the UK chancellor, Rishi Sunak, to follow suit and cut tax on fuel in the UK.

At a meeting in Dublin, ministers agreed a 20 cents (17p) cut in tax on unleaded petrol, 15 cents on diesel and 2 cents on agricultural diesel until the end of August.

The finance minister, Paschal Donohoe, said: “We are experiencing the consequences of a war. The government is acting now, with this excise measure in response to price rises that we have seen today but also in anticipation of further rises that we do expect to see over the short to medium term.”

The Irish government made the decision after stark warnings from experts about the impact Russia-Ukraine war would have on fuel and food security.

Donohoe said state resources were limited, indicating a fall in tax revenues would need to be clawed back.

With oil prices now at a 14-year high, Sunak is being urged to cut VAT on petrol to ease the pressure on householders and businesses already facing spiralling costs.

The average price of a litre of petrol in the UK, already at record levels, rose from 156.4p on Monday to a new high of 158.2p on Tuesday, compared with Ireland where it is around 205c (172p).

VAT makes up 16% of the price of fuel according to the Royal Automobile Club, which said a cut in VAT from 20% to 15% would reduce the cost per litre by about 6p.

Drivers and businesses have also been hit by a record daily increase in diesel prices. Figures from the data firm Experian Catalist show the average cost of a litre of the fuel at UK forecourts reached 165.2p on Tuesday, up nearly 3p on Monday’s 162.3p. The RAC said the jump was the largest on records dating back to the year 2000.

Haulier