Tax on carbon to be proposed by the European Commission

March 5th 2010

The European Commission has announced that it is soon to present a legislative proposal for the introduction of a carbon tax in the European Union.

The new EU commissioner for taxation, Emer Traynor, told a press conference yesterday that the imposition of a “carbon tax” was one of her priorities. She explained that legislative proposals for the tax will be ready within the coming few months.

So far, EU member states have been divided on the issue of a carbon tax, which has made the EC reluctant to introduce an EU-wide tax on carbon - but this is about to change it seems.

Any change in taxation must be approved by all 27 member states in order to be passed. Although this may be a challenge in some countries, others have already introduced their own national tax on carbon. This is the case in Sweden, Denmark and Finland.

France is another nation that intends to bring in a tax on diesel and gasoline fuel. The government hopes it will be a lucrative change to tax law, along with one that will help reduce fuel consumption.