A Fianna Fáil senator has called for the carbon tax reduction announced in Budget 2027 to be extended to liquefied petroleum gas (LPG).

Senator Robbie Gallagher said the fuel is of particular importance to poultry farmers and rural households across Cavan and Monaghan.

Budget 2027 reduced the carbon tax rate on natural gas and kerosene from €63.50 to €48.50 per tonne of carbon dioxide.

Although the government paused the planned increase in carbon tax on LPG, the fuel was not included in the reduction and remains subject to the €63.50 rate.

The Monaghan senator raised the issue in the Seanad with Minister of State at the Department of Climate, Energy and the Environment, Alan Dillon.

LPG

Senator Gallagher welcomed the decision to reduce the carbon tax on natural gas and kerosene, but said he was disappointed that LPG was not included in the same reduction.

"More than 50,000 households and tens of thousands of businesses across Ireland rely on LPG, many of them in rural areas where there is no access to the natural gas network.

"This is particularly important in Cavan and Monaghan, where we have a very significant poultry industry.

"Unlike many other businesses, poultry farmers cannot simply reduce their heating usage when costs increase.

"Maintaining the correct temperature is essential for bird welfare and production, and LPG is a necessary expense for these farms," he said.

Poultry

The poultry industry generates approximately €700 million in annual output and supports more than 5,000 jobs nationally, including approximately 3,500 in the Border region.

Around 70% of Ireland's poultry flock is concentrated in the Border region.

According to Teagasc, a standard poultry house accommodating 27,000 birds uses approximately 36,000 to 40,000 litres of LPG annually.

"I fully recognise the measures the government has already taken to ease energy costs, including the decision to pause the planned carbon tax increase on LPG.

"However, I believe there is a strong case for extending the reduction to LPG users, particularly when so many of them have very limited alternatives available," Senator Gallagher said.

The senator said that he will continue to pursue the issue as the Finance Bill progresses through the Oireachtas.

Carbon tax

Minister Dillon said the government has implemented a range of supports easing the pressures of increased energy prices caused by the conflict in the Middle East.

"It is one of the largest support packages in the EU per capita, now totalling over €1.7 billion targeted at households and businesses," he said.

The minister noted that a recent Central Statistics Office (CSO) energy use survey found around three in every five households use natural gas or heating oil-kerosene as their main home heating fuel.

"Conversely, only 1% of households are identified as using liquefied petroleum gas as their main heating fuel, according to the survey.

"As I said, the decision was taken to pause the scheduled October 14 carbon tax increase on other fuel products, including LPG, to provide some relief to LPG users," he said.

The minister committed to take the Senator Gallagher's concerns back to the Tánaiste and Minister for Finance, Simon Harris.

"There is a non-carbon excise levied already on LPG. The carbon tax on LPG remains at May 2025 rates and LPG attracts a 9% VAT rate, unlike some other heating fuels.

"Those reductions are very much targeted to provide a cost reduction which we have seen in the two predominant home heating fuels in the country, taking into account the extraordinary market-driven price increases on the likes of kerosene since March of last year.

"There is the anticipated price increase in natural gas and the inflation that will arise in recent increases in unit rates by major suppliers.

"No government can insulate the full price increases across many households, but in Budget 2027 we have continued to target measures," he said.