Calls for carbon tax to be slashed by almost half
New figures show that the carbon charge is set to hand ministers a €250m windfall this year, yet opposition parties claim just €130m of that is going to the schemes earmarked for the money.
The Government is engaged in a “rip-off” operation which goes against the initial aim of the levy, according to Fine Gael energy spokesperson Simon Coveney. Despite Coalition claims the tax would be “revenue-neutral” and act as a way to change people’s habits, not raise extra revenue, it has now become a “cash cow”, say opponents.
Mr Coveney has demanded ministers either lower the carbon tax burden on families or make sure it all goes on green initiatives.
“The Government is being grossly dishonest and ripping-off the taxpayer.
“Tax figures relating to the carbon tax show that it has raised €53.1m in the year to April and, with home heating oil about to be levied, in set to yield €250m this year.
“Ministers had claimed it would be done on a revenue-neutral basis – funds from the tax are supposed to address energy efficiency, fuel poverty and competitiveness issues. However, the Government is taking in at least €120m more than it is spending in 2010 alone and €200m in a full year.
“Minister Gormley claimed 36m from the carbon tax was to be set aside for use as a PRSI exemption for employers who take unemployed people off the dole. This measure has not been implemented. Even if it is implemented before the end of the year, there is still €90 million going straight into Government coffers.
“Fine Gael supports the concept of a carbon tax but it must be revenue-neutral. In fact, all of the reports on taxation reform recommend that carbon tax should be introduced as a revenue-neutral measure. This means that either the Government should reduce the tax burden in another way to the same value as carbon tax revenue or it should ring-fence carbon tax revenue to spend on alleviating fuel poverty and supporting alternative non-carbon-based fuel production. While Minister Ryan pretends that carbon tax is financing energy efficiency programmes, the truth is we are raising twice as much on the back of consumers than we are spending on energy conversation measures.”
A spokesperson for Energy Minister Eamon Ryan said green initiatives were being paid for across Government and not just in the field of energy efficiency.
“It is estimated that the carbon tax, inclusive of VAT, will yield approximately €250m in 2010. The revenue will, amongst other things, be used to boost energy efficiency, to support rural transport and to alleviate fuel poverty,” Finance Minister Brian Lenihan said in a parliamentary answer.
