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Carbon tax increases will be refunded via welfare or tax system – Taoiseach pledges


Taoiseach Leo Varadkar (Brian Lawless/PA)

Taoiseach Leo Varadkar (Brian Lawless/PA)

Taoiseach Leo Varadkar (Brian Lawless/PA)

Taoiseach Leo Varadkar has denied claims the Government plans to quadruple carbon tax rates to tackle climate change.

Mr Varadkar said a carbon tax will not resolve the climate change challenge on its own.

“But we won’t solve climate change without carbon tax”, the Taoiseach said in reply to Sinn Féin leader, Mary Lou McDonald.

“There is absolutely no prospect of a carbon tax increase of that scale or anything remotely approaching it,” Mr Varadkar said of reports that the plan is for a four-fold increase.

“If there is an increase in the carbon tax, it is my strong view that the carbon tax should be ring-fenced, and the money given back to people in the form of increases in the fuel allowance and in increased tax credits and in the form of a dividend model,” the Taoiseach added.

Mary Lou McDonald said the way to fight climate change was not to penalise ordinary families and working people by increasing their fuel and/or utility bills.

The Sinn Féin leader said her party would not support any carbon tax increase that does not protect low and middle-income earners and did not ensure that polluters paid their share.

“We already have high energy charges in this State and the current carbon tax has not lowered emissions,” Ms McDonald said.

Meanwhile, Varadkar has been accused of telling the French president that Ireland “can cope” with the fallout from a threatened UK Brexit crashout without a deal.

Fianna Fáil leader, Micheál Martin, told the Dáil it was high time the Taoiseach told the Irish people in full about the implications of a no-deal Brexit happening in 17 days’ time on April 12.

Mr Martin also said the Taoiseach must reveal in full the nature of “ongoing contacts” between the Government and the EU’s policy-guiding Commission about how to manage the Irish border in the event of a no-deal outcome. It was clear no-deal Brexit would mean Irish border controls – the only question was about where and how such controls would be done.

“It’s time to be upfront and tell the people,” Mr Martin said.

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The Fianna Fáil leader pointed to the report about  Brexit economic damage by the think-tank, the ESRI. This found in the event of a no-deal Brexit up to 80,000 Irish jobs would be lost.

He asked the Taoiseach whether he had replied to questions from French president, Emmanuel Macron, at the weekend EU leaders’ summit about the implications for Ireland of a no-deal Brexit. Mr Martin noted the Taoiseach had not denied reports that he told President Macron: “We can cope.”

But the Taoiseach hit back and asked whether Fianna Fáil would be prepared to tolerate Irish border checks as part of the price of staving a no-deal Brexit. He defended the Government’s record on preparing for Brexit – including a no deal outcome.

He acknowledged that the ESRI report’s findings were not good news. But he argued that even in that scenario there would be more jobs, increased growth, and income increases – though all these indices would be lower than in a non-Brexit situation.

Mr Varadkar said extensive legislation for a no-deal scenario had been passed and signed into law by the President. He said a low-cost Brexit loans to business will be launched tomorrow by Agriculture Minister, Michael Creed, and Jobs Minister, Heather Humphreys.

The Taoiseach said there were ongoing contacts with the EU Commission but the details of handling a no-deal Brexit depended on the stance which the London government would take.

“There have been no papers, no documents exchanged,” Mr Varadkar said about Brussels-Dublin talks.  He again said Ireland and the EU will insist the UK must uphold its obligations under the 1998 Good Friday Agreement.

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