EU ministers to consider energy tax plan

The most difficult issue is likely to be a request from France and Italy to maintain reduced tax rates for diesel used by hauliers. Germany, backed by the European Commission, is opposing such a concession. The EU has debated for years the merits and drawbacks of setting minimum tax levels for electricity and gas, but has never agreed on the matter which requires unanimity among the bloc\'s 15 member states. Environmentalists want an increase in energy tax as an essential policy to spur companies and individuals to use energy frugally and reduce the pollution caused by fossil fuels and nuclear power. EU diplomats said an agreement was possible, although there were many outstanding disagreements on the various exemptions from the tax required by member states. Another question is whether there should be a general exemption for agricultural energy use. The draft under discussion would set a minimum tax rate of 0.50 euros per megawatt of electricity for businesses and one euro per megawatt for householders. For coal and natural gas, the proposed minimum rates are 0.15 euros per gigajoule for firms and 0.30 for private consumers. Many energy intensive industries would be able to get a full exemption in order to protect their international competitiveness. The European Environmental Bureau, a coalition of major green groups, said Tuesday\'s meeting could be a last chance for the tax proposals which have languished on the negotiating table since the mid-1990s. Denmark, one of the EU\'s most environmentally-aware countries, has made the issue something of a priority. It is unlikely to receive the same attention from Greece and Italy which will chair the EU for the next 12 months. In 2004 the EU is due to let in up to 10 new member states, making unanimous decision-making even harder than at present. \"A positive decision must be made now on this proposal, or it may never be made at all,\" EEB Secretary General John Hontelez said. \"We are convinced that the problems are exaggerated and can be overcome.\" REUTERS NEWS SERVICE