Dáil Éireann Debate, Tuesday - 7 July 2026
260. Deputy Richard Boyd Barrett asked the Tánaiste and Minister for Finance the estimated annual cost of jet fuel VAT and excise exemptions in 2024 and 2025; and if he will make a statement on the matter. [51306/26]
Amharc ar fhreagraAll liquid fuels are subject to Value-Added Tax (VAT), and to excise duty in the form of Mineral Oil Tax (MOT).
The VAT treatment of goods and services is subject to EU VAT law, with which Irish VAT law is obliged to comply. In general, the EU VAT Directive provides that all goods and services are liable to VAT at the standard rate, unless they are exempt or fall within certain categories of goods and services to which Member States are permitted to apply lower VAT rates subject to certain rules. The Directive also allows a Member State to maintain historic arrangements subject to certain strict conditions.
Under the EU VAT Directive, various VAT rates apply to aviation fuels. The zero rate applies to fuels for aircraft used by international airlines. The standard rate of VAT applies to fuels supplied for other purposes or customers (e.g. private jets), except in the case of jet fuel/aviation kerosene where Ireland retains its historic application of the reduced rate of VAT (currently 13.5%).
I am advised by Revenue that traders are not required to identify the VAT generated from the supply of specific goods and services on their VAT returns. Therefore, it is not possible to provide an estimate of VAT forgone on the supply of jet fuel.
With regard to excise duty, Ireland’s treatment of aviation fuels is governed by European Union law as set out in Directive 2003/96/EC on the taxation of energy products and electricity, commonly known as the Energy Tax Directive (ETD). ETD provisions on liquid fuels are transposed into national law in Finance Act 1999 (as amended) which provides for the application of excise duty in the form of MOT. Current and historic MOT rates are published on Revenue’s website at www.revenue.ie/en/tax-professionals/tdm/excise/excise-duty-rates/energy-excise-duty-rates.pdf.
Heavy oil, or jet fuel/aviation kerosene, is the most commonly used fuel for commercial aviation. As required by the ETD, Ireland applies a full MOT exemption to jet fuel used for commercial aviation, including domestic, intra-community and international flights. I am advised by Revenue that based on volumes declared as exempt on MOT returns, the total MOT relieved on jet fuel used for commercial aviation is estimated at €0.9bn for 2024, and €1.1bn for 2025.
