Environment-related tax take increases 2.6% to €5bn

Revenue from environment-related taxes in 2016 is highest level recorded to date

Last year, some €3.1 billion was collected in energy tax, an increase of €0.8 billion on 2007. Photograph: iStock
Last year, some €3.1 billion was collected in energy tax, an increase of €0.8 billion on 2007. Photograph: iStock

The Revenue Commissioners collected €5 billion in environment-related taxes in 2016, an increase of 2.6 per cent on the previous year and the highest level recorded to date.

Environment taxes are collected on things that have a negative impact on the environment, with taxes on transport fuels accounting for 61 per cent of the total take.

According to data from the Central Statistics Office, vehicle registration and motor taxes contributed €2.5 billion to the exchequer in 2007 and last year contributed €1.9 billion. That drop is partly explained by the drop in sales of new cars and the change in the emissions basis for vehicle registration tax.

Taxes concerning pollution rose to €58 million last year, up by €13 million on the previous year. The plastic bag and landfill levies were significant in this category.

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By far the most significant cohort were taxes relating to energy. This category includes carbon tax, electricity tax and duty on oil products. Last year, some €3.1 billion was collected in energy tax, an increase of €0.8 billion on 2007.

Households were the biggest single contributor to environment taxes and represented a 58 per cent share of the total tax take. The service industry was the second biggest contributor and represented a 31 per cent share of the environment tax receipts. That industry paid €1.5 billion last year, their highest level.

Environment taxes levied on the agricultural sector were €0.08 billion in 2016, thereby increasing the sectors share of total environment taxes from 0.6 per cent in 2007 to 1.5 per cent in 2016.

Peter Hamilton

Peter Hamilton

Peter Hamilton is a contributor to The Irish Times specialising in business