Euro Essay, Research Paper

Tax breaks promised by France and Italy to lorry drivers who mounted fuel price protest blockades in the summer looked to set to cause controversy among EU finance ministers meeting in Brussels today (19 January). The concessions are illegal under EU competition law and upset some of the countries? EU partners who were angry that the French and Italian governments gave in to the protesters.

The French and Italians argue that they cannot now renege on their promises to the lorry drivers and they want to continue the tax breaks. But other countries, such as Germany, which refused to yield to the protesters, oppose the concessions. The issue looks certain to continue the friction between France and Germany which began during the French Presidency.

Germany and Austria have demanded that the EU set a maximum annual allocation of cut-price fuel for each lorry.

The European Commission, however, has proposed that the tax breaks on diesel be extended but are banned permanently after the end of 2002.

It looked like a difficult issue to resolve for the Swedish Presidency, hosting its first Ecofin meeting, and many observers expected that a solution might not be found until the next meeting in February.

Ecofin agenda

EUbusiness, 19 January 2001

Categories: Italy, European Council, Competition, Finance, Transport, France