Thursday 26 April 2018

11 days to go until Budget 2018: Here is what we know so far

  • Price of diesel is expected to remain unchanged - despite speculation
  • Possible initiatives to encourage purchase of second-hand electric vehicles
  • Excise duty on cigarettes and tobacco will rise
Taoiseach Leo Varadkar. Photo: Reuters
Taoiseach Leo Varadkar. Photo: Reuters
Kevin Doyle

Kevin Doyle

The price of diesel is expected to remain unchanged in Budget 2018, despite speculation it could be equalised with petrol.

Changes to excise duty are always among the final decisions made in the process, often on the morning of the Budget.

However, sources told the Irish Independent there was a strong sense that diesel would not be targeted.

Hauliers have previously argued they are struggling to meet fuel costs, while Brexit is also a factor.

Drivers of diesel cars are likely to be spared in the Budget. Stock picture
Drivers of diesel cars are likely to be spared in the Budget. Stock picture

According to AA the average price of a litre of diesel is currently €1.22. This already includes taxes totalling almost 73c.

Petrol is around €1.35 at the average pump, including 86c in tax.

It had been thought diesel would increase as part of the Government's drive to force motorists to be more environmentally friendly.


The Budget will include a number of initiatives aimed at encouraging a greater uptake of electric vehicles.

A series of long-term measures are under consideration, with a focus on incentives to encourage a change in driver behaviour.

The Irish Independent understands initiatives are being planned in particular to encourage the purchase of second-hand electric vehicles.

Relief on Vehicle Registration Tax for the purchase of hybrid electric vehicles and plug-in hybrid electric vehicles is currently in place until the end of next year, but this is likely to be extended.

While diesel is likely to be left untouched, sources say excise duty on cigarettes and tobacco will rise.

It will be the sixth consecutive budget to see an increase in the price of cigarettes.

Last year, then finance minister Michael Noonan added 50c to a packet of 20 cigarettes, bringing the price to more than €11 for the first time.

The move will be welcomed by health campaigners, but already retailers have raised concerns that the ever-increasing price of tobacco is leading to a rise in smuggling.

In its pre-budget submission, Retailers Against Smuggling, which represents traders on both sides of the Border, said the excise hikes were undermining their "ability to do business and is making life considerably easier for criminals engaged in cigarette smuggling".

It is not yet clear whether Finance Minister Paschal Donohoe has any plans to change the excise duty on alcohol.

A sugar tax is certain to feature in Mr Donohoe's Budget speech but will not be introduced before April 2018.

The Government is keen to align its policy on taxing sugary drinks with similar developments in the UK in order to reduce the risk of cross-Border shopping.

Irish Independent

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