Varadkar: 'Absolutely no chance' of four-fold increase in carbon taxes

Varadkar: 'Absolutely no chance' of four-fold increase in carbon taxes

Taoiseach Leo Varadkar has said there is “absolutely no chance” of a four-fold increase in carbon taxes in the next budget.

On Sunday, under questioning, he offered the figure of €80 per tonne as the likely charge amount compared to the current figure of €20.

But, Mr Varadkar has since told the Irish Examiner that there is no chance the increase will happen in one move and also raised doubt as to whether any increases in carbon charges will occur.

He said: “Absolutely no chance of a four-fold increase in carbon tax in the next budget or anything remotely close to that, if there is even an increase at all.”


Mr Varadkar's spokesman said that the Government is keen that this process of moving away from carbon-heavy fuels be done on a cross-party basis.

On Sunday, Mr Varadkar said that increases in carbon taxes are “on the table” in October, while Energy Minister Richard Bruton said bills will have to rise to end the State’s reliance on fossil fuels by 2030.

But clarifying the position will ease concerns of homeowners and motorists who are facing higher bills.

Mr Varadkar rejected the increases could reach €1,500 as forecasted by the Economic and Social Research Institute (ESRI).


Instead, he said the increases would be in line with the Oireachtas Climate Action Committee’s recommendation of €80 per tonne, which is four times the current limit.

Having backed away from introducing carbon taxes in last October’s budget because of a backlash from Fine Gael backbenchers, consumers will be bracing themselves for the extent of the increase this year as Ireland seeks to improve its woeful environmental performance.

The Taoiseach, who declared Ireland is a laggard when it comes to decarbonising our economy, said the purpose of the carbon tax is “not about punishing you in the pocket or raising revenue for government”.

“We want to ensure money goes back to people by way of tax credits and other measures.”


He added that increasing carbon tax is only part of the solution, but on its own, it is not the total solution.

Mr Bruton raised the target from 55% to 70% for the amount of electricity generated from renewable sources by 2030 but admitted this ambitious goal will need to be funded.

“We are not going to be able to deliver renewable sources of power at nil cost,” said Mr Bruton. “The reason the world has got hooked on fossil fuels is that it is a cheap source because no one has taken account of the damage done by said fossil fuels to our climate which is truly catastrophic.