Planned carbon tax hike will go ahead – despite soaring cost of living

As backbench TDs from Fianna Fáil and Fine Gael revolt over the planned increase, Tánaiste Leo Varadkar said nothing can be done without the support of all three parties in the Coalition.

Mr Varadkar also warned that delaying the planned increase for May will mean double the pain in a few months’ time.

The issue is likely to dominate political party meetings and Dáil debate this week.

Mr Ryan said the Budget measure had already been decided upon and approved by the Dáil.

But the minister said he will bring measures to Government in the next two weeks to help people reduce their energy bills.

Meanwhile, Mr Varadkar warned Government rebels that giving up the increase, of €7.50 more per tonne of carbon dioxide emitted, “means a double increase down the line in October or next May”.

The revenue collected is being used to part-fund the fuel allowance, as well as warmer home retrofitting and green schemes for farmers, the Fine Gael leader said.

“So the impact on those programmes would have to be considered too,” he said.

Sinn Féin leader Mary Lou McDonald opposed the hike, saying: “What we don’t want is the levying of further increases on households and families at a time when people are trying to cope with spiralling inflation.

“It makes absolutely no sense for the State to propose to go ahead and levy these increases at a time when they know that families are really struggling. People are making the choice between heating and eating.

“The rationale for carbon taxes is to disincentivise over-use. It’s aimed at behavioural change. But spiralling inflation and the hardship that families are facing is effecting huge behavioural change, to the extent that older citizens are staying in bed and families are heating only one room. That’s how bad things are.”

Mr Varadkar warned the carbon tax rise “is already legislated for, so the Government position can only be changed by agreement of all three parties”.