A Fine Gael senator is calling for all carbon taxes to be suspended due to the ongoing surge in fuel prices.

The Government last night voted to reduce excise on petrol, diesel and green diesel in a bid to reduce prices at the pump.

There are concerns however, that many petrol stations hiked their prices before the change came into effect at midnight – effectively swallowing up the reduction before it came into force.

Carbon tax

An increase to carbon tax on home heating fuels is due to come into effect on May 1st – with no increase on transport fuels scheduled until October 12th.

Funds raised through the increase are being ring-fenced for just transition measures – including targeted social welfare initiatives to prevent fuel poverty and State investment in the national retrofitting programme.

At the Fine Gael Parliamentary Party meeting last night, Senator Tim Lombard called for this year’s increases to be suspended to offer certainty to hauliers and farmers.

One Newstalk Breakfast this morning, he went further – calling for all carbon taxes introduced since 2010 to be suspended.

“None of us foresaw the actual prices when we set the carbon tax trend in budget,” he said. “Prices at the pump are just frightening at the moment.

“Extraordinary times require extraordinary measures and this is an extraordinary measure and we need to step back and actually reduce the carbon tax for this period of time.”

When it was put to him that there is no planned increase to carbon taxes at the pump until October – he called for action on the taxes that are already in place.

“I am saying that all carbon tax needs to be suspended for this period of time,” he said.

He admitted that doesn't know what the move might cost the Exchequer – but insisted the current prices are so high, “we actually do have to take extraordinary measures”.

Climate crisis

Just a week ago, the UN Intergovernmental Panel on Climate Change (IPCC) warned that any further delay to global climate action will “miss a brief and rapidly closing window to secure a liveable future”.

The panel’s latest report warned that “half-measures are no longer an option” – noting that that billions of people and thousands of species are at risk.

Senator Lombard accepted that “climate change is a really important issue” – but insisted the war in Ukraine required short-term action.

“If you take the measures put in place like carbon tax, it is about getting people to change their mode of transportation and insulating houses – all of them are long-term measures,” he said.

“The unfortunate short-term crisis we have at the moment is having a massive impact on people’s daily life and people’s ability to live.”

Impact

He noted that people depend on fuel and are facing real difficulty in filling up their cars.

“This is having a massive impact on our pockets,” he said. “We are 15 days into a war and the impact has been quite significant – not only on fuel but on other aspects of our society.

“So, because of that, I think short-term measures are needed to make sure we can actually survive the next few months.”

Rural/urban divide

He also suggested the impact is bigger outside of the cities.

“There is a rural urban divide to some degree,” he said.

“We were talking during the week about farmers sowing more grain but at the moment, farmers can’t buy diesel for their tractors.

“As I said, extraordinary measures for extraordinary times. We are literally in a wartime measure. When did you ever actually think we would be asking the agricultural community to grow more grain?”

Carbon tax is due to increase by €7.50 per tonne every year until 2029 and by €6.50 in 2030 – taking it to €100 per tonne.