Temporary VAT Reduction Won’t Include Heating Oil Or Solid Fuels

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The temporary reduction in VAT on energy products will not include home heating oil or solid fuels.

A VAT reduction from 13.5% to 9% agreed with the European Commission will only cover gas and electricity.

This will reduce the average gas bill by €49 per the average electricity bill by €61. Petrol and diesel are taxed at 23% and will not be covered by the VAT reduction however, excise on both fuels were reduced last month.

Those currently receiving the Fuel Allowance will be supported by a further lump sum payment of €99.

The government today says these supports will make up the extra cost for fuel and energy due on May 1st when the carbon tax increases.

The cabinet meeting tomorrow is also to consider a proposal to cut the PSO levy on energy bills to zero saving consumers €58 per year.

The length of time that the temporary VAT reduction will be in place will also be decided by the Cabinet tomorrow.