Cuts to petrol and diesel taxes extended until November

The excise cuts amount to a 27c cut per litre of petrol and a 32c cut per litre of diesel. File picture: Nick Ansell/PA

Families returning to the work and school commute won't be bracing for an imminent hike in their fuel bills after cuts to petrol and diesel taxes were extended until November.

After a little over an hour of debate during an emergency sitting, TDs voted to retain the cuts which were introduced following the fuel crisis.

Tánaiste Simon Harris said the Government was providing certainty for businesses over the next two months by retaining lower excise on fuels. 

He also said the Coalition could further pause planned carbon tax hikes in October’s budget.

“If the last six months have told us anything, it's how rapidly the world can change," Mr Harris said.

"Oil prices can rise, they can fall, supply routes can be disrupted. We've seen enormous movements in energy markets over just a few short weeks.

“Locking the Irish taxpayer into decisions many months and possibly years in advance, regardless of what happens internationally, is not certainty. It’s actually imprudent.”

The excise cuts amount to a 27c cut per litre of petrol and a 32c cut per litre of diesel.

These will now slowly be withdrawn over the course of several months, with the Government saying they will be completely removed by the end of February.

The Government is also extending the reduced NORA levy until October 31, alongside continuing the enhanced Diesel Rebate Scheme until late December.

The cost of extending the fuel supports is expected to cost €407m from now until March, with a total spend by the Government of €1.3bn on measures over the last year.

The major spending on fuel assistance follows warnings from the Irish Fiscal Advisory Council over the size of October’s budget package.

However, pressure remains on the Government to further assist people with the cost-of-living, with the opposition demanding relief in the upcoming budget.

Both Labour and the Social Democrats said there targeted energy credits should be introduced in the October 6 announcement.

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Sinn Féin leader Mary Lou McDonald said the Government had not gotten the message. She said it has not stopped fuel tax increases, but just rescheduling them.

“It’s kicking the can down the road. It is postponing the pain, not removing it.” 

She said the Government must keep taxes off petrol and diesel while fuel prices remain high and called for “meaningful” cost of living reliefs in Budget 2027.

It comes as new data from the CSO says fuel sales surged in July, after prices dropped following a ceasefire between the US and Iran.

According to its latest retail sales index, the fuel sector experienced a monthly value increase of 2.4% in July compared to June while the volume of sales increased by 7% in that time.