UK slams european commission proposal to equalize commercial diesel taxes

Diesel Fuel News, June 9, 2003

Such as scheme if adopted across the European Union (EU) would have no positive impact on competition or the environment and would steal about 2 billion euros (U.S. $2.3 billion) of United Kingdom revenue each year. So concludes a recently approved U.K. Parliament subcommittee report on the EC's plans to gradually harmonize commercial diesel fuel taxes at around 350 euros/l,000 liters (U.S.

$416/kiloliter) by January 2010. The U.K. Parliament's European Union Economic and Financial Affairs subcommittee, which penned the report, is urging the EC to drop its proposal. According to the report, five member states - the U.K. (where diesel is taxed the highest), Italy, France, Denmark and Germany - would have to make significant tax cuts to reach 350 euros/1,000 liters, leading to major losses in state revenue. The remaining 10 member states would have to increase their tax rates - some rather heavily - which in the past has led to majo r trucking industry work stoppages. While rejecting commercial diesel tax harmonization, the subcommittee report endorses a minimum tax rate to avoid a "race to the bottom."