Dáil Éireann Debate, Thursday - 7 May 2026
252. Deputy Pearse Doherty asked the Tánaiste and Minister for Finance the action he will take in light of the AccelerateEU communication where the European Commission confirmed that member states can tax windfall profits of energy companies to ensure social fairness; and if he will make a statement on the matter. [33798/26]
View answerThe Government is conscious of the increased financial pressure on households and businesses arising from the ongoing conflict in the Middle East. In response, the Government has introduced temporary and targeted measures to reduce fuel prices for households and businesses, with additional supports for key sectors of the Irish economy. This includes the reduction of excise on petrol and diesel, extending the fuel allowance season by a further four weeks, and targeted relief to haulage and bus passenger operators. Measures have also been taken to assist farmers, agricultural contractors and fishers facing unprecedented increases in fuel costs.
As the Deputy may be aware, a Temporary Solidarity Contribution (TSC) was introduced in line with Council Regulation (EU) 2022/1854 of 6 October 2022 to tackle windfall gains being made in the energy sector at the time. Specifically, the TSC was levied on fossil fuel producers and applied at a rate of 75 per cent on a measure of surplus taxable profits in both fiscal years 2022 and 2023.
It is important to note that, while the TSC was administered by the Revenue Commissioners, it was not a tax measure; it was a solidarity contribution arising from an energy Regulation agreed at EU level. As such, the TSC formed part of a co-ordinated European response, reflecting the highly interconnected nature of EU energy markets and a view that an emergency intervention to mitigate the effects of high energy prices at the time could not be sufficiently achieved by Member States individually.
The European Commission’s AccelerateEU communication addresses the EU’s rising energy costs on volatile fossil fuel markets and aims to accelerate the clean energy transition and strengthen EU energy resilience. While the communication notes that Member States may take domestic measures with regard to windfall profits, no EU-wide approach has as yet been agreed. It is the Government’s view that tackling the energy crisis in a coordinated way between EU member is preferable given the interconnectedness of EU energy markets, and that a State-by-State approach would risk fragmenting or unbalancing the level playing field for the single market for electricity.
In the context of global crises, it is important to carefully consider the potential for unintended consequences that may arise from the design and implementation of exceptional fiscal interventions during periods of acute volatility, including longer-term effects on investment, market behaviour, and energy supply. The ongoing conflict in the Middle East underlines, once again, why we must accelerate the deployment of renewables across all sectors, continue to invest in our grid, and continue to invest in retrofitting of homes and businesses across the country.
