State in dock over cheap yacht fuel

The Government is being taken to court for allowing yacht owners to avail of the same cheap fuel as fishing vessels.

For a number of years, the European Commission has been warning the Government it must not allow pleasure craft to use duty free green diesel that also carried a lower rate of Vat.

This fuel, normally dyed green to distinguish it from normal diesel, is reserved for fishing vessels, farm vehicles and for heating.

Yacht owners and cruising businesses, like those on the Shannon, have been lobbying the Government to continue the current system. The Department of Finance said they made the case that the only fuel available for use for boats on inland waterways and in marine locations was marked gas oil.

The department also pointed out that Britain uses a similar system which is also being challenged by the EU. But groups, like Social Justice Ireland, have said the Government should eliminate the cheap diesel system for everyone and estimate it would bring in an extra €450m a year to the nation’s coffers.

It would also get rid of a multi-million euro income for criminal gangs that remove the dye and sell the diesel at full price.

A statement from the European Commission said they had decided to refer Ireland to the Court of Justice. They point out that private leisure boats that use dyed diesel in Ireland if caught with the fuel in another EU country would face heavy penalties for using illegal fuel.