This Proposal is part of the European Green Deal’s ‘Fit for 55’ legislative package and its main purpose is to reverse the impact of the existing Directive which actually favours fossil fuels. The new Directive would achieve this by:

  • setting higher rates for fossil fuels and lower rates for renewables products;
  • reviewing the possibility of tax reductions and exemptions which currently lower the taxation of fossil fuels.

These objectives will be achieved by:

  • switching from volume to energy content based taxation;
  • eliminating incentives for fossil fuel use; and
  • introducing a ranking of rates according to their environmental performance.

Full EPF Secretariat report under epf21-67 of 05.08.2021