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Irish government to cut excise duty on diesel and petrol

John CampbellEconomics and business editor, BBC News NI
Getty Images A woman with short curly brown hair with blonde highlights filling her car up at a petrol station.Getty Images

Excise duty on petrol and diesel is set to be cut by the Irish government in a bid to help people with volatile prices caused by the war in the Middle East.

From midnight on Wednesday until the end of May, excise duty on diesel will be reduced by 20 cent and petrol by 15 cent.

The proposals, which were agreed at a leaders' meeting on Monday, will be brought to cabinet for approval on Tuesday.

A diesel rebate scheme for hauliers and bus operators is also expected, which will be backdated.

Diesel prices rose from about €1.80 (£1.56) per litre to between €2.20 and €2.30 at the weekend.

Petrol also rose steeply to about €2.

Will people travel across the border for fuel?

For people living in the border counties of the Republic of Ireland and Northern Ireland, the matter of where you buy your fuel has traditionally been important for household finances.

Before 2008, it was almost always cheaper to fill your car in Ireland but since then Northern Ireland has generally been the better option.

That is because fuel taxes in Ireland were raised sharply after the country's financial crisis and continue to rise due to an annual carbon tax escalator.

The UK is supposed to have a similar fuel duty escalator, but it has been effectively frozen for more than a decade.

The most recent figures suggest petrol and diesel are almost 30p a litre more expensive in Ireland. So even if the emergency tax cuts are fully passed through to consumers, Northern Ireland is likely to remain the cheaper option.

PA Media A man with light hair, he is wearing a navy blazer, white shirt and green tie with shamrocksPA Media

Earlier, Taoiseach (Irish Prime Minister) Micheál Martin welcomed US President Donald Trump's announcement that strikes against Iran power plants have been postponed due to "productive" talks with Tehran.

Following this, crude oil prices dropped, but Martin said he would not get "into specifics" about whether this would affect the supports.

There will be an excise reduction for agricultural or green diesel.

The overall package which will also include targeted energy supports for pensioners, carers and people with disabilities is set to cost €235m.


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