The proportion of the price of diesel accounted for by tax will hit 54% following an expected increase in the carbon tax in October’s budget.
This will put Ireland at the top of the European league when it comes to tax on diesel, alongside Malta, according to Fuels for Ireland.
Meanwhile, 57.2% of the cost of petrol will be tax following anticipated budget changes, the organisation said. This will be the third highest level in the EU.
The high tax rates follow recent restoration of cuts in excise, which have driven prices higher over the last few months.
The last increase came on 1st August, which followed a previous increase on 1st April.
“With the upcoming budget poised to introduce further tax hikes, we need to address the significant impact these changes will have,” said Kevin McPartlan, CEO of Fuels for Ireland.
“The forecasted increases with the recent excise duty and the upcoming carbon tax will propel Ireland to the top of the EU fuel taxation rankings, placing an unprecedented financial burden on both consumers and businesses.”
“This escalation will exacerbate the already challenging conditions for businesses, particularly in border regions, and significantly increase costs for consumers.”
Fuels for Ireland says an expert group on taxation is now required, to ensure energy policies support both the transition to sustainable energy and affordable fuel, while safeguarding revenue.
It says the group would bring together Government departments, Revenue, economists, environmental specialists and representatives from the fuel sector.