EU finance ministers expressed their differences in an exchange of views on the reform of the Energy Tax Directive in a public debate at the Ecofin Council on Tuesday 6 December. While all agreed to introduce more flexibility to make European rules correspond to the specificities of each country, some regretted that environmental considerations were not taken into account enough.
“Some ministers would like the file to have a stronger environmental orientation and to be more ambitious. However, some other ministers believe that the level of flexibility should be increased to reflect national tax systems and to allow each Member State to choose its own energy mix”, summarised the Czech Minister, Zbyněk Stanjura, who chaired the Ecofin Council.
The ministers from the island countries placed particular emphasis on their geographical specificity. Cypriot Minister Konstantínos Petrídis expressed concern about the abolition of tax exemptions for the aviation and maritime industries, noting that his country “is connected to the rest of the world mainly by air and faces prominent connectivity issues with the price of fuel”. Ireland, Malta, Greece, Portugal and Spain agreed, with the Iberian countries referring to the outermost regions.
For Rositza Velkova-Jeleva from Bulgaria, socio-economic specificities are also very important, especially for those Member States whose gross domestic product is below the EU average. “Achieving the EU’s long term environmental objectives in order to be not only successful, but also fair should provide an opportunity for a smooth transformation of the weaker economies in the EU”, she said.
Concerns were also raised about the risk of loss of competitiveness of European industry, particularly in the maritime sector. “It is important to keep, at least for a transitional period, the possibility to distinguish the tax rates applied for business and non business purposes”, stressed the Italian Finance Minister, Giancarlo Giorgetti.
Finland, Estonia and Latvia, on the other hand, have expressed reservations about taxing wood products. Wood is an important energy resource for them, and they are waiting to see how the sustainability of wood fuels will be addressed in the Renewable Energy Directive (see EUROPE 12930/10).
Like her Belgian, Luxembourg and French counterparts, Sigrid Kaag, the Dutch minister, expressed her concern that “in our drive to achieve the climate goals, and our willingness to include a number of exemptions, that the range of exemptions in the end will be greater actually then our ambition levels, and targets and indicators when it comes to achieving the goals that we’ve set”.
For Mr Stanjura, the work ahead will be to find a balance between minimum levels of taxation and to address the lack of transitional periods. (Original version in French by Anne Damiani)