The Green Party has proposed giving every worker and social welfare recipient a €180 annual carbon tax dividend as part of efforts to tackle climate change.
Party leader Eamon Ryan yesterday called for a €20 increase in the carbon tax in the Budget this year as part of a plan to eventually raise it to €90 by 2030 - but he said the steep rise could be offset by a direct payment back to citizens. At present carbon tax is charged at €20 per tonne.
Speaking after the Green Party conference in Cork, Mr Ryan the proposed doubling of the tax could be offset by offering an immediate dividend in the Budget.
“We want to do it as a dividend. It would be 100pc returned. It would be through the social welfare system and the tax system. It would be a cash payment in advance of the revenue being raised because you can predict how much will be raised,” Mr Ryan said.
He said that under the Green Party plan everyone in the country would get €180 every year via a social welfare payment or a tax credit. This would rise as the carbon tax is increased every year. Mr Ryan said he hoped to lay out the proposal to Finance Minister Paschal Donohoe in talks this week and claimed that it would benefit those less well-off because they tend to pollute less.
“I hope to meet Paschal during the week and raise it and make the case. It's progressive, it benefits those on low incomes, it is a clear immediate signal for everyone to reduce their carbon, but it doesn't hit people in the pocket."
Despite expectations that the tax would be increased by €10 in the Budget next month, Fianna Fáil leader Micheál Martin signalled last week that his party would veto such an increase, instead proposing a €5 or €6 hike.
The €10 increase was recommended in a report from the cross-party Oireachtas Climate Action Committee earlier this year. That report also recommended that revenue from the tax increase be ring-fenced for climate action measures.
The government has yet to outline whether any increase in the carbon tax will go towards climate action measures or be returned as a dividend to citizens. Communications and Climate Change Minister Richard Bruton declined to be drawn on the details of any carbon tax increase in an interview with Newstalk yesterday.
But Mr Bruton insisted there would be a "strong climate focus" in Budget 2020 and that every minister will have to issue a new climate mandate for public bodies under their remit.