The Poultry Committee of the Irish Farmers’ Association (IFA) has called on the government to retain a 9% VAT rate on Liquefied Petroleum Gas (LPG) and electricity.
As the government prepares to announce cost-of-living support measures, the IFA national poultry chair, Nigel Sweetnam warned that, if reversed, poultry farms could face significant cost increases.
In Budget 2023 it was confirmed that the reduced VAT rate of 9% applying to gas and electricity supplies will be extended until February 28, 2023.
LPG is a liquified hydrocarbon gas that is supplied in a bulk tank or cylinder. LPG combustion emits 33% less carbon dioxide (CO2) than coal, and 11% less than kerosene heating oil.
Stating that the Carbon Tax is now 2% of the cost of rearing a chicken, Sweetnam said that a continued 9% VAT rate on LPG would help alleviate the financial burden on poultry farmers.
Poultry farms
Calling on the government to continue the reduced VAT rate, the IFA national poultry chair said:
“We urge the government to consider the impact that this change could have and to take steps to support poultry farmers during these challenging times.
“By retaining the 9% VAT rate on LPG, the government can help to ensure the sustainability of the poultry industry and safeguard the interests of consumers.”
He added that the sector plays a vital role in supplying high-quality and affordable food, and any unnecessary cost increases could have a significant impact on the industry and consumers.
The reduction from 13.5% to 9% VAT was introduced on gas and electricity as part of the National Energy Security Framework to secure supply after the Ukraine war, according to Sweetnam.
Carbon tax
The Carbon Tax rate per tonne of CO2 emitted increased from €41 to €48.50 for transport fuels from October 2022. The €7.50 increase on home heating fuels will begin on May 1, 2023.
As part of Budget 2023, the government said that the revenue that will be raised by this increase in Carbon Tax is estimated at €9.5 billion between 2021 and 2030.
The 2023 revenue will be used for targeted social welfare to prevent fuel poverty and ensure a just transition; to part fund a socially progressive national retrofitting programme; and to incentivise farmers to farm in a greener and more sustainable way.