‘Pizza tax’ on processed foods recommended by Tax Commission

The Government-appointed group is also suggesting huge increase in property taxes and road-usage taxes in a new report which calls for a radical overhaul of the tax and welfare systems over the next 10 to 15 years to fund the climate transition and a future with lower corporation tax.

A contentious proposal from the commission is that there should be tax on highly processed foods to discourage people from buying them.

This would mean that family favourites like pizzas, chicken nuggets and chips would face consumer taxes. Currently there is no Vat on food products.

The Commission recommends: “The Government should reserve the right to impose taxes on the consumption of ultra-processed foods, in order to support its policy of reformulation.”

And the commission calls for an additional charge to electricity bills is also set to be highly contentious.

Commission members said any increases should be carefully timed, clearly signalled in advance and should not act as a disincentive to the use of renewable electricity sources in carbon-intensive activities.

There is already Vat imposed on electricity bills. It has temporarily been reduced to 9pc, from 13.5pc, in response to the crippling cost-of-living crisis.

A public service obligation (PSO) charge applies to electricity bills, although that is negative at the moment. There is no carbon tax on electricity bills.

“The Commission recommends the introduction, in the medium term, of distance, location and time-based road usage charges,” the report states.

There should also be congestion charges in urban areas, the Commission recommends