Donegal fuel prices could rocket 15 cent a litre more than across the border

A planned increase in excise duty on fuels which is scheduled for April 1 could see fuel in Donegal 15 cent a litre more expensive than across the border, and put some retailers out of business according to Fuels for Ireland (FFI).

The FFI is the industry body representing entities providing 50% of Ireland's total energy.

And they are now urgently calling for the Minister for Finance and the Government to postpone the excise duty increase

This will lead, they say, to a huge difference in prices at the pump with retailers south of the border at an extreme disadvantage including Donegal.

This follows the  UK Chancellor of the Exchequer announcing last week that he has postponed increases on fuel excise duties for 12 months. 

Here in the Republic, there are two excise duty increases scheduled for April and August. 

But the FFI say that resultant differences in prices at the fuel pumps between Ireland and the UK will put fuel retailers operating in Donegal at such a disadvantage that many will face the prospect of going out of business.

FFI also reiterated its call for the establishment of an Expert Group on Taxation to examine all issues surrounding tax as the economy transitions to net zero carbon emissions.

Kevin McPartlan, CEO of Fuels for Ireland said:

"There could be a 15 cent a litre difference in the price of petrol between retailers on both sides of the Border by August. Undoubtedly, this would mean that retailers in Donegal 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. The UK Chancellor of the Exchequer made a similar decision. 

Ireland intends to increase excise duties to their previous levels with two increases on April 1 and August 1. However, just last week in his Spring Budget, the UK Chancellor of the Exchequer, Jeremy Hunt, 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. Forecourt operators in border constituencies are expected to face a substantial reduction in demand. 

“With many retailers situated near the Border, the price gap between Northern Ireland and Ireland will drive consumers across the Border, posing a grave threat to the viability of local forecourts.

“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.

“Additionally, we call for the establishment of an Expert Group on Taxation to assess the broader implications of taxation changes, especially in alignment with our commitment to achieving net-zero carbon emissions by 2050.

“We urge the Government to prioritise the economic stability of Border constituencies and the nation as a whole by addressing this issue promptly.”