EC to look at European fuel tax burden

The hotly-debated issue of the fuel tax burden in Europe will top the agenda Friday when the European Commission (EC) sits down with the national competition authorities from European Union (EU) member states to discuss competition law in the motor fuels sector. The EC meeting, said by the commission to have been scheduled since July, comes in the wake of the fuel crisis that brought many EU countries to a near-standstill last month.


LONDON�The hotly-debated issue of the fuel tax burden in Europe will top the agenda Friday when the European Commission (EC) sits down with the national competition authorities from European Union (EU) member states to discuss competition law in the motor fuels sector.

The EC meeting, said by the commission to have been scheduled since July, comes in the wake of the fuel crisis that brought many EU countries to a near-standstill this month.

European Competition Commissioner Mario Monti said the high fuel prices and the "role of oil companies in the Europe" would be key issues on the agenda at the meeting. Though the EC recognized changes to competition regulations on the Continent would "not solve all, or even most problems" in this sector, Monti insisted that the commission nonetheless "intend[ed] to explore the extent to which community and national competition law [could] contribute to a more competitive motor fuel sector."

Among the forces driving up the fuel in Europe, according a recent EU study, are the "dramatic" rise in crude oil prices, the depreciation of the Euro against the US dollar, and fuel taxation policy.

"The tax factor is the highest of the three main factors affecting the price of fuel," the report's authors acknowledged, noting that taxes on fuel ranged form around 50% in Portugal, Greece, and Luxembourg to 75% in the UK.

The report emphasized that the main rationale for motor fuel tax was "to discourage the use of mineral oils as the main source of energy, so as to reduce the overall emissions of gases into he atmosphere."

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