Energy Taxes (EU)

On the 5th December, the relevant Council of the EU (government ministers of the EU) adopted conclusions of the European Commission on the EU energy taxation framework. The Council Conclusions on energy taxation are here.

The Conclusions are a response to the European Council’s call to advance work on the conditions, incentives and enabling framework to ensure a transition to a climate-neutral EU, in line with the Paris Agreement. The aim is to contribute to the policy objectives and measures to achieve the environmental, energy and climate targets for 2030, while preserving European competitiveness, and respecting member states’ rights to decide on their own energy mix.  

The energy taxation directive adopted in 2003 identifies energy products subject to harmonised rules for excise duties, sets minimum levels of taxation and lays down conditions for applying tax exemptions and reductions, ensuring the proper functioning of the internal market.

The EU now has a new regulatory framework and policy objectives in the area of climate and energy.

The Council Conclusions call on the Commission to analyse and evaluate possible options for a possible revision of the energy taxation directive. The Commission is invited to give particular consideration to the scope of the directive, minimum rates and specific tax reductions and exemptions.

In addition the Conclusions call on the Commission to update provisions, as appropriate, in order to ensure that they are practicable and provide greater certainty and clarity in its implementation, taking notably into consideration:

• the treatment of biofuels and other alternative fuels,

• the applicability of control and movement provisions to certain products, such as treatment of lubricants and designer fuels,

• new energy products and technologies,

• relevant sectors, such as aviation, taking into account their specificities and existing exemptions and international dimension,

• impacts on government revenues,

• state aid processes and rules.

The Council highlights the importance of fully assessing its proposals in terms of their economic, social and environmental costs and benefits and their implications for competitiveness, connectivity, employment and sustainable economic growth, particularly for sectors most exposed to international competition.

European Parliament declares Climate Emergency (EU)

Ahead of the UN COP25 Climate Change Conference in Madrid 2-13 December, the European Parliament has today approved a resolution declaring a climate and environmental emergency in Europe and globally.

The adopted resolution will be available here.

The European Parliament also wants the European Commission to ensure that all relevant legislative and budgetary proposals are fully aligned with the objective of limiting global warming to under 1.5 °C.

In a separate resolution, the European Parliament urges the EU to submit its strategy to reach climate neutrality as soon as possible, and by 2050 at the latest, to the UN Convention on Climate Change. This adopted resolution will be available via the above link.

Members of the European Parliament (MEPs) also call on the new European Commission President Ursula von der Leyen to include a 55% reduction target of greenhouse gas emissions by 2030 in the European Green Deal.

In addition, MEPs say that all countries should include emissions from international shipping and aviation in their national contributions plans (NDCs), and they urge the European Commission to propose that the maritime sector be included in the EU’s Emissions Trading System (EUETS).

Note – the European Commission has already proposed the goal of net-zero emissions by 2050, but the European Council has not endorsed it as some Member States are opposed.

UK exits the EU (EU Brexit Preparedness)

The EU issued today (19th July) a Communication on preparing for the withdrawal of the UK from the EU on 30 March 2019. It is located in the Other Preparedness activities section of the EU’s Brexit Preparedness online site – here.

The Communication is accompanied by a Factsheet and a Press Release, as you can see from the direct link – here.

The Factsheet makes clear –

” If the Withdrawal Agreement is ratified before 30 March 2019, most of the legal effects of Brexit will apply as of 1 January 2021, i.e. after a transition period of 21 months, the terms of which are set out in the draft Withdrawal Agreement.

In the absence of a Withdrawal Agreement, there will be no transition period and EU law will cease to apply to and in the UK as of 30 March 2019.

The negotiations between the EU and the UK on the terms of the Withdrawal Agreement are still ongoing. Once negotiations have concluded, the Withdrawal Agreement will need to be ratified. The future relationship between the EU and the UK can only be negotiated after the UK has left the EU.

In addition, even if the Withdrawal Agreement is ratified and an agreement on the future relationship is successfully concluded during the transition period, this relationship will not be that of a Member State of the EU.

Therefore, all businesses concerned have to prepare, make all necessary decisions, and complete all required administrative actions, before 30 March 2019 in order to avoid disruption. “