The price of fuel is set to increase at petrol pumps from midnight after Minister for Finance Michael Noonan announced a €5 increase per tonne in the carbon tax in Budget 2012.
Mr Noonan said the increase from €15 to €20 per tonne will apply to petrol and auto-diesel from tonight. It will not apply to other fuels until May of next year due to the “on home-heating costs over the winter months”.
The rise could see up to 3 cent per litre added to the price of petrol and diesel.
The price of kerosene, marked gas oil, liquid petroleum gas (LPG), fuel oil and natural gas will also increase from May 1st next year.
The Minister ruled out applying the carbon tax to solid fuels and said there will be “no increase for peat, coal or the bail of briquettes or the bag of blocks”.
Carbon tax is applied to a range of domestic and transport fuels and is measured by calculating the weight of carbon dioxide emitted by each fuel.
Department of Finance figures estimate that a €5 per tonne increase could yield €108 million in a full year to the State.
Mr Noonan also said he was reducing the VAT rate on district heating from 21 per cent to 13.5 per cent to bring it in line with the majority of other heating supplies.
And he said he plans to amend the VAT refund order for farm construction allowing for a refund on wind turbines purchased from the start of next year.
Mr Noonan also increased the excise duty on a packet of 20 cigarettes by 25 cent from midnight.
He also flagged the €100 per year household charge, which has already been announced by Minister for the Environment Phil Hogan. A waiver will apply for those on mortgage interest supplement and for those living in cetain categories of unfinished housing estate.
