Two of Ireland’s three largest political parties have signed a document proposing a new coalition to lead the country’s recovery in the aftermath of the COVID-19 pandemic.
In a draft joint framework document published April 15, Fianna Fáil and Fine Gael invited other parties to unite with them to form a new coalition government. They set out 10 goals, including universal healthcare, a new green deal, and an economic recovery package, including a freeze on income tax and Universal Social Charge increases. The parties also want to increase the carbon tax to €80 per metric ton by 2030, with the ultimate goal of achieving carbon neutrality by 2050. The parties said these and many related issues must be addressed by a new government to help the country rebuild once the danger of the pandemic has abated.
Since the document's publication, feedback has been pouring in from members of other parties and various trade groups. In an April 15 release, Labour Party leader Alan Kelly welcomed the parties' collaboration, saying it demonstrates that both have revised some of their earlier views. However, more work will need to be done, he said.
“It is clear from first reading that this is an uncosted, purely aspirational document that will require detailed scrutiny," Kelly said. "It fails to mention any concrete timelines or when any of the mooted ideas would be delivered." He said Labour Party members of Parliament will examine the document more carefully "in the coming days.”
On April 16 several news outlets reported that Green Party leader Eamon Ryan said his party would require a commitment from Fianna Fáil and Fine Gael to reduce emissions. Ryan reportedly said they would also need to provide more details regarding social housing initiatives.
Irish Farmers Push for Carbon Tax Pause
In an April 7 letter to Finance Minister Paschal Donohoe, the Association of Farm and Forestry Contractors in Ireland said the financial impact of the COVID-19 pandemic on the farming sector — exacerbated by some farmers' problems with electronic fund transfers during mandated social distancing — is starting to trickle down to people's paychecks. An upcoming carbon tax increase would worsen the situation, it said.
Under the 2020 budget, Ireland's carbon tax on agricultural diesel fuel is scheduled to increase from €20 to €26 per metric ton May 1.
Michael Moroney, the association's chief executive, told Tax Notes that farming income is expected to reflect falling cattle and dairy prices in Ireland and throughout Europe. "This will put additional financial pressure on farmers who have already been slow to pay their farm and forestry contractors,” he said, adding that contractors carry out 80 percent of the mechanization work on Irish farms and produce €700 million in annual turnover.