Government could 'finesse' tax on home heating, Fuels for Ireland says

Vivienne Clarke

The Government could "finesse" the VAT on home heating costs because people in rural Ireland are paying more than city dwellers, Kevin McPartland, CEO of Fuels for Ireland has said.

People who heat their home with gas pay 9 per cent VAT, while those who use oil pay 13.5 per cent VAT.

“I don’t understand why that is the case,” he told RTÉ Radio’s Today with David McCullagh show.

Sixty per cent of homes in rural Ireland heat their homes with oil, so are paying more.

“What this means is that people in rural Ireland are paying more VAT to heat their homes than people who live in Dublin.

“So that's one thing that government could do. I know it would take a little bit of finessing with the European Union in terms of changing VAT levels, but the Spanish changed the VAT levels this week on fuel.

It's not impossible, and it's something that government really needs to be looking at now.”

McPartland described the government’s reduction on excise rates as a knee-jerk response.

“I now need to hear from government what the non-knee-jerk response is. We have been saying for a long time that we need an expert group to review the total taxation and compliance costs the government controls. That means that fuel in Ireland is more expensive than almost anywhere else in the European Union.

“We need to do that now. It's absolutely urgent. So I really hope that when the Minister makes the announcement of this particular policy intervention today, he will also say that we're going to have that strategic, considered look, so that we're not going from knee-jerk to knee-jerk response."