The Irish government has agreed to implement a set of new measures to help address the rising costs of energy, including a cut of VAT on gas and electricity from 13.5% to 9% until the end of October 2022 and an extension of temporary excise reductions on petrol, diesel and green diesel. In addition, the excise levy on green diesel will be reduced again by €2.7c/l and 370,000 fuel allowance recipients will receive a €100 lump sum to help cover rising energy costs.
The policy is expected to offset the increase in carbon tax on 1 May 2022, which will rise from €33.5/tCO2eq to €41/tCO2eq. In March 2022, the country already lowered excise duty by €20c/l on petrol and by €15c/l on diesel, at a total cost of €310m; the green diesel excise duty was cut by €2c/l at a cost of €10m.