Northern Ireland motorists contribute €230m in tax

Cross-border fuel trade is worth €230m annually to the Exchequer as thousands of motorists from the North avail of cheaper petrol and diesel in the Republic.

A major new study indicates that it contributes over 7% of all tax receipts from motor fuel consumption in the Republic but has a negative impact on the Republic’s greenhouse gas emissions.

It also found stations close to the border have considerably higher-than-expected levels of sales, particularly of diesel. 

Motorists from the North contribute around €202m in excise duty, carbon tax and Vat on sales of diesel and a further €28m in petrol sales.

The joint study by the Economic and Social Research Institute, Revenue and Trinity College Dublin, said the elevated levels of fuel tourism for diesel might partly be attributable to heavy goods vehicles and vans which avail of cheaper prices near the border before they start long-distance journeys onto Britain and mainland Europe.

Overall, sales of diesel in the Republic since 2010 have increased by 21% while petrol consumption has fallen 27%. 

The research estimated that stations close to the border sold 54.4% more diesel and 14.6% more petrol than an otherwise identical station located in another part of the Republic. 

The report said cross-border demand for fuel represented an important source of tax revenue for the Exchequer.

However, it found such trade also contributed significantly to the Republic’s national greenhouse gas emissions, even though most of the fuel was probably consumed outside the jurisdiction. 

It estimated that cross-border traffic for the purpose of “fuel tourism” resulted in an additional 1.17 million tonnes of CO2 emissions per annum —equivalent to 2% of the Republic’s total national greenhouse gas emissions.

Researchers examined retail sales at 543 petrol stations in border areas over a two-year period between April 2013 and March 2015.

They noted that the excise rate in the Republic was 13% lower than in the North for petrol and almost 30% lower for diesel. 

While the UK Vat rate of 20% is lower than the Republic’s 23% rate, the study found such differences still resulted in a significant premium on UK fuel prices.


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