Government to maintain 9% VAT on electricity until 2030

The Government will maintain the reduced 9% VAT rate on electricity charges until 2030, Taoiseach Micheál Martin has confirmed in the Dáil.

Speaking during Leaders’ Questions, the Taoiseach defended the state's response to cost-of-living pressures, pointing to the extended VAT reduction as a key long-term measure to assist households.

The confirmation came during a debate with Deputy Mary Lou McDonald, who warned that more than 1 million households faced energy price hikes of between 8% and 11% from suppliers Electric Ireland and Yuno Energy. McDonald stated that Irish energy customers already pay the highest electricity prices in the European Union, averaging over €500 more per year than neighbouring countries, with more than 500,000 household accounts in arrears.

In response, the Taoiseach acknowledged the severe pressures on household budgets, attributing energy inflation to international factors including supply chain issues, the invasion of Ukraine, US tariffs, and geopolitical conflicts in the Middle East.

Martin outlined several state interventions designed to ease these financial pressures. Alongside the 9% VAT rate commitment, he cited Budget 2026 measures such as increased child support payments and fuel allowances. He also highlighted a prior support package worth between €755 million and €771 million, which reduced fuel duties—cutting 32 cent off the price of diesel, 27 cent off petrol, and 7.4% off marked gas oil—and deferred planned carbon tax increases until 14 October.