Tough ride for EC tax
UK CHANCELLOR Kenneth Clarke blocked renewed moves to impose an energy tax at a meeting of European Community finance ministers in Luxembourg in June. Clarke maintained his predecessor had done enough to curb carbon emissions through the proposed imposition of VAT (value-added tax) on domestic fuel and the commitment to raise petrol prices.
The poorer south European countries have also asked for partial exemption from the tax for some time so that their economic development is not impeded. However, the Danes believe an EC-wide levy will protect the environment and help shift taxation away from employment generation to resource use.