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Ireland budget fails to impress

[ October 12, 2023   //   ]

The budget announced by Minister for Finance Michael McGrath on 10 October  offers very little for the freight distribution and logistics sector, says FTA Ireland (FTAI). 

Chief executive Aidan Flynn, said: “In Ireland a large percentage of fuel price is made up of taxes and excise duty. To alleviate some the financial pressures, the heavy goods vehicle (HGV) and public service vehicle (PSV) sectors currently participate in a Diesel Rebate Scheme (DRS) which provides a 7.5 cent per litre rebate – dependent on terms and conditions – payable three months after the fuel has been purchased.  Ahead of the budget announcement, FTAI urged government to review the scheme to enable greater flexibility, including expansion of the scheme to include the Own Account sector, and improve efficiency, calling for the facilitation of monthly claims and payments. The lack of reference to this within the budget is therefore a disappointing oversight.”

In its pre-budget submission, FTAI also highlighted that consideration must be given to reviewing the categorisation of Vehicle Registration Tax for all electric light commercial vehicles. Flynn continued: “We welcome the announced changes to the Vehicle Registration Tax relief for battery electric vehicles – in which the qualifying value has increased to €50,000, and will be applicable to the end of 2025. However electric LCVs are significantly more expensive than conventional diesel vehicles and tend to be valued in excess of €60,000. Currently the VRT of an electric vehicle is generally around 13.3% of the vehicle value, which makes the total price of electric light vehicles uncompetitive. … FTAI will continue calling for the VRT on electric vehicles to be capped at a rate comparable with their diesel equivalent.”

He concluded: “While we welcome the news that the planned excise duty increase on diesel is now postponed until April 2024, this budget offers very little for hard pressed businesses in the freight distribution and logistics sector – which like many other sectors of the economy are facing increased financial challenges – and it is clear that there is still more to be done to support the industry charged with delivering Ireland’s goods.”

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