EU Ministers Deflect Calls for Cuts In Fuel Taxes

by Ulrika Lomas, Tax-News.com, Brussels

03 June 2004

As the price of crude oil reached fresh highs in both London and New York this week, EU finance ministers have sought to deflect growing calls from business for cuts in fuel duty to ease mounting energy costs.

"It is not a good solution to use the tax instrument," the Belgian Finance Minister Didier Reynders told reporters on Wednesday, before a meeting with fellow ministers from the EU member states.

"We need to have a better dialogue with the OPEC countries," he added, confirming the European Commission’s line that Europe must seek ways of influencing the major oil producing nations to raise output in order to bring about a fall in the price of crude oil.

Meanwhile, European Commissioner for Economic and Monetary Affairs, Joaquín Almunia has announced that member states are due to discuss the oil price issue next month with a view to establishing a common approach to the matter.

Meanwhile, the British government has come under increasing pressure to scrap a planned 2p per litre rise in fuel duty in September, as prices at the pump surpass the levels that sparked a protest by the road haulage lobby in 2000 when fuel depots were blockaded, paralysing much of the country’s transport infrastructure.

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