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Discussions of EU committees and working parties - Νew proposed Directive for the taxation of Energy products and Electricity

Council Proposal for amending Directive 2003/96/EC restructuring the Community framework for the taxation of Energy products and Electricity

Council Directive 2003/96/EE of 27 October 2003 provides the framework for the harmonization of energy products and electricity within the European Union. More specifically, it defines the taxable energy products, lays down the minimum rates that are to be applied to each according to their use (motor or heating fuel) and sets up the conditions for exemptions or reductions to minimum levels of taxation.

For there to exist a proper framework available for use in energy taxation and, at the same time, meet EU targets on climate change, in March 2008, the European Council called for a better alignment of the above directive with these objectives. Consequently, in April 2011 the Commission presented to the Council a Proposal for a Council Directive amending Directive 2003/96/EC (Document 9270/11 FISC39 ENER 89 ENV303 ) restructuring the Community framework for the taxation of energy products and electricity, with the view :
  • to ensure consistent treatment of energy sources within the ETD (Energy Taxation Directive) in order to provide a genuine level playing field between energy consumers regardless of the energy source used.
  • to provide an appropriate framework for the taxation of renewable energies.
  • to provide a framework for the use of CO2 taxation to complement the carbon price signal established by the ETS while avoiding overlaps between these two instruments.


To achieve these objectives, the Commission proposed, amongst other things, the following:
  • The introduction of two components of energy taxation, one specifically linked to CO2-emissions attributable to the consumption of the products concerned and another based on the energy content of the products.
  • The establishment of a relationship between the minimum levels of taxation fixed in the ETD for the various energy sources
  • The revision of the minimum levels of taxation, ensuring in particular that they reflect CO2 emissions and net calorific value in a consistent manner for the various energy sources, providing at the same time transitional periods where deemed necessary.

The proposal is being discussed in the Council's Working Party on Tax Questions - Indirect Taxation ( Energy Taxation ) where the Republic is being represented by officers of the Excise Section of the Department.



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