Minister Durkan's department had previously proposed increasing the levy from 5p to 10p from April 2014.
However, Durkan said provisional figures showing a large reduction single use bag numbers had convinced him to drop the planned increase.
In a statement, the Department of Environment said: "A recent local survey highlighted that, despite the very substantial reduction in single use bag numbers, only 56% of shoppers are frequently reusing their carrier bags.
"Retailers will, of course, still be free to operate a 'bag for life' policy, whereby shops apply an initial charge for these more durable bags and then replace these bags for free when they are worn out. The levy won't apply to these free replacements."
'Welcomed'
PAFA director Barry Turner welcomed the news. He told Packaging News: "I am pleased to see a more balanced approach coming through. It is great to see that common sense has prevailed to some degree. There have been a number of developments in Ireland.
"They have taken a sensible approach to bottle deposit schemes and packaging levies. A sensible approach seems to be prevailing. They have started to realise the cost of administrating and legislating these things will outweigh the environmental benefits."
