On 14 July 2021, a proposal to revise the Energy Taxation Directive was adopted as part of the “Fit for 55” package. This proposal has as its main objective to align the taxation of energy products with the energy and climate policies of the European Union, promoting the use of clean technologies and eliminating exemptions and reduced rates that currently encourage the use of fossil fuels.
The proposed changes include a different way of taxing fuels, based on their energy content and environmental performance rather than their volume. This would allow businesses and consumers to make cleaner and climate-friendly decisions. According to this new classification, conventional fossil fuels, such as diesel and gasoline, would be taxed at the highest rate, while electricity would be taxed at the lowest rate.
In addition, the classification of products for tax purposes would be simplified, so that those fuels most harmful to the environment are those that pay the most taxes. In addition, xisting exemptions for certain products and domestic heating would be phased out, implying that fossil fuels could no longer be taxed below certain minimum levels set.
One of the most significant changes proposed is that fossil fuels used in air transport, maritime transport and fisheries within the European Union would no longer be completely ree of energy taxation. This means that taxes on these fuels would be levied, reinforcing the intention to promote more sustainable practices in these sectors.
It is important to emphasise that the proposal requires unanimity in the Council of the European Union for its adoption. Prior to its adoption, the proposal shall be consulted with the European Parliament and the European Economic and Social Committee, following a special legislative procedure.