The impact of the energy taxation directive


Instead of comprehensive re-examination of the Energy Taxation Directive, the European Commission is examining whether ETD should continue the exemptions and lower tariffs for specific products. ETD claims to improve the internal market and energy efficiency and to contribute to jobs and growth. However, it achieves neither. The taxation of energy has added to the tax burden of EU citizens rather than shifting it. It creates additional costs to industry, reducing the competitiveness of EU companies. If another period of high oil prices is coming, the European Union should mitigate them by lowering taxes on energy. Just as ETD prescribes minimum levels of taxes, the EU could also apply maximum levels of energy taxes.

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