Taoiseach hints at excise cuts for fuel amid soaring cost of energy

Taoiseach Micheál Martin speaking to the media at the Irish Memorial in Philadelphia. Picture: Niall Carson/PA Wire

Excise cuts for fuel have been hinted at by the Taoiseach as he signalled that the Government will not freeze carbon tax amid the soaring cost of energy.

Micheál Martin said the Government is planning to target any reliefs on energy to those “most in need”, but appeared to leave the door open to excise tax changes.

Speaking to reporters in Philadelphia, Mr Martin said the Government is keeping all options “under active review” amid the energy price surge stemming from the US-Israeli war in Iran.

“Obviously we have to see how things evolve. It’s been volatile and we have to look at it both in the short term and medium term, because there could be second-round inflationary impacts as a result of the impact of the war, particularly oil and gas prices,” Mr Martin said.

“Anything we do, we want to target and make sure that we target and help those most in need and those furthest behind and who will be most impacted.

“But there are a number of potential issues that we have to address and we are looking at it.”

Asked about the prospect of changes to carbon tax, Mr Martin appeared to rule out any freezing of the levy. He highlighted the tax provides for the Government’s retrofitting programme, alongside funding fuel poverty schemes.

However, he said there are “other mechanisms” the Government can use to lessen the impact of fuel costs.

One source said this could be a change to excise taxes on fuel, citing that this was done after the outbreak of war in Ukraine.

However, they said no decisions have been made as of yet, citing the need to wait until after a meeting of EU leaders next week.

Asked about recent comments by EU Energy Commissioner Dan Jorgensen, who called on individual countries to cut taxes on energy to help reduce costs, Mr Martin reiterated that the Government is keeping “everything under active review”.

He said the Government would not be reversing any Budget 2026 measures to pay for possible cost of living measures, while highlighting it extended the lower VAT rate on gas and electricity out to 2030.

“Any response will be looked at broadly in terms of revenues and expenses,” Mr Martin added.

Mr Martin is currently in Philadelphia on the Government’s annual visit to the United States for St Patrick’s Day.

The Taoiseach said he would be discussing the ongoing war in Iran with US president Donald Trump when he visits the White House on Tuesday, saying the Government wants to see “de-escalation”.

“We want this brought to a conclusion very, very quickly, We want civilian lives protected… We prefer the diplomatic route and we would like to see a resolution of this,” Mr Martin said.

However, Mr Martin said the Iranian regime was “repressive” and it had murdered thousands of its own civilians in recent years.

The Taoiseach said he would articulate the “need for peace” with Mr Trump.