The EU has given the Irish government "tools to apply windfall tax on energy companies and help farmers with rocketing fertiliser costs", an MEP has said.

Fianna Fáil MEP Billy Kelleher said that a windfall tax on energy companies and further supports to farmers regarding higher fertiliser prices is "possible under the European Commission’s AccelerateEU plan".

“While there will be no EU-wide windfall tax, the possibility is there under this plan for national governments to levy such a tax," Kelleher explained.

"The Irish government should make use of this option, I believe."

Fertiliser prices

He said that many other member states are likely to take this chance to use such a windfall tax to pay for the "costly energy supports needed to assist homes, families, farmers and SMEs at this difficult time".

“Energy companies cannot be seen to profit off citizens' hardships," the Ireland South MEP continued.

“In addition, there is scope under the plan for member states to compensate up to 70% of a beneficiary's extra costs from the price increase of fertilisers caused by the crisis or a flat rate of €50,000."

He said that fertiliser prices in Ireland have risen by approximately 20% for CAN and approximately 60% for urea since hostilities broke out in the Middle East.

"While prices have stabilised, the ongoing challenges will likely result in prices increasing or at best, staying at their current level," Kelleher said.

“The EU has responded with increased flexibility regarding state aid rules.

"Ireland should make use of the chance to ease the burden wherever possible."