European Commission 'Looking Closely' at Removing Bunker Fuel Tax Exemption

by Ship & Bunker News Team
Thursday December 10, 2020

The European Union may seek to end the tax exemption for bunker fuels, according to a new strategy paper on sustainable transport policy.

On Wednesday the European Commission published a report titled 'Sustainable and Smart Mobility Strategy', setting out suggested changes in transport policy.

"When revising the Energy Taxation Directive, the Commission will aim at aligning taxation of energy products and electricity with EU energy and climate policies," the Commission said in the report.

"As part of the ongoing impact assessment, it is looking closely at current tax exemptions, including for aviation and maritime fuels, and will make proposal on how best to close any loopholes in 2021.

"The taxation of energy content for various fuels should be better aligned, and the uptake of sustainable transport fuels better incentivised."

Aviation and shipping should be given "priority access to additional renewable and low-carbon liquid and gaseous fuels, since there is a lack of suitable alternative powertrains in the short term," the Commission said.

These fuels could include hydrogen, hydrogen-based synthetic fuels and advanced biofuels, according to the report.