The introduction of refundable income tax credits — a system that would mostly benefit low-paid workers — with the likely cost of such a scheme put at an estimated €1 billion is also examined in the papers.
The paper on Climate Action and Tax outlines how the State has committed to a 51 per cent reduction in greenhouse gas emissions by 2030. They also note calls for a shift towards weight-based taxation for cars — a system already in place in Norway, Belgium and the Netherlands.“Therefore within the existing tax system the larger more pollutant cars are those which are already subject to the highest rates of tax,” say officials. But they add it is “likely that in the medium to longer term, vehicle taxes may shift to a weight-based vehicle tax or surcharge in order to protect the vehicle tax base”.
A proposed revision of an EU Energy Tax Directive involves changes to taxation of electricity including a gradual removal of the exemption for residential electricity users with an optional exemption for vulnerable households.