Fuels for Ireland (FFI) has revealed that differences in fuel duty between the Republic and Northern Ireland could put fuel station forecourts in border counties at risk of closure due to uncompetitive pricing. The news comes after the UK Chancellor of the Exchequer, Jeremy Hunt, used his Spring Budget to announce that the UK Government would put a freeze on fuel excise duty for 12 months. FFI is calling on the Minister for Finance to do likewise in Ireland and postpone two planned increases in excise duty that are due to be introduced on 1 April and 1 August.
A difference in fuel prices between the two countries could see drivers take their business north to take advantage of lower fuel prices. That would put filling stations in the border counties of Louth, Cavan, Monaghan, Leitrim, Sligo and Donegal at a distinct disadvantage, and could put them at risk of going out of business.
Taxation rethink
As well as highlighting the risk of petrol forecourt closures, Fuels for Ireland also called for the establishment of an Expert Group on Taxation to look into future duties and how the government would still earn revenue as the Irish economy moves towards net-zero carbon emissions by 2050.
Kevin McPartlan, CEO of Fuels for Ireland, highlighted the issues surrounding the taxation differences between the two countries: "There could be a 15 cent a litre difference in the price of petrol between retailers on both side of the Border by August," he said. "Undoubtedly, this would mean that retailers would be under such huge pressure that many could go out of business.
"During the cost-of-living crisis, the Irish Government made the correct decision to reduce excise duties on fuel, and the UK Chancellor of the Exchequer made a similar decision. Ireland intends to increase excise duties to their previous levels with the two increases in April and August, but the UK Chancellor of the Exchequer announced that the UK will postpone any increases for the next 12 months. This will lead to a huge difference in prices at the pump, with retailers south of the border at an extreme disadvantage.
"Secondly, the Irish Exchequer stands to suffer a considerable loss in income as fuel sales plummet due to cross-border purchases. This reduction in State revenue contradicts the intended goal of increasing excise duty. Fuels for Ireland urges the Minister for Finance and the Government to reconsider the decision to increase excise duty and to postpone it in light of the UK's actions.
"We urge the Government to prioritise the economic stability of Border constituencies and the nation as a whole by addressing this issue promptly."