# CE2004065EN.01001101.xml

| 13.3.2004 | EN | Official Journal of the European Union | CE 65/11 |
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13.3.2004

EN

Official Journal of the European Union

CE 65/11

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(2004/C 65 E/011)

WRITTEN QUESTION E-3458/02

by Christopher Heaton-Harris (PPE-DE) to the Commission

(6 December 2002)

Subject:   Tax treatment of biodiesel in Germany and France

Subject:

What is the tax treatment of biodiesel made from rapeseed methyl ester (RME) compared to normal mineral diesel in Germany and France?

Total-Fina-Elf sells diesel containing a percentage of RME. Could the Commission confirm whether this is because of taxation encouragement from the French Government or due to a French Governmental decree?

Answer given by Mr Bolkestein on behalf of the Commission

(16 January 2003)

(16 January 2003)

| 1. | The normal rates of excise duties applicable to diesel used as a propellant are currently EUR 389 and EUR 440 for thousand litres in France and Germany respectively.
  Germany, according to § 1 Abs. 2 Mineralölsteuergesetz i.V.m. § 1 Abs. 2 Nr 1 Mineralölsteuerdurchführungsverordnung, grants a full tax exemption to 97 % pure biodiesel sold in Germany. In practise, this tax exemption applies mostly to methyl esters having a vegetable origin (including rapeseed).
  The German legislation is based on Article 8(2)(d) of Council Directive 92/81/EEC of 19 October 1992 on the harmonization of the structures of excise duties on mineral oils (1). The Commission has not yet examined in depth whether this article is appropriate; however, the Commission's proposal for a special regime for the taxation of biofuels, which is likely to be adopted in the coming months, has taken this specific situation by a so-called ‘grand-fathering’ clause (Article 8c paragraph 3) into account. This clause would allow Member States, which on 1 January 2001 totally exempted products solely made up of biofuels, continue to totally exempt these until 31 December 2003.
  France has been authorised by the Council to grant permits for the application of a differentiated rate of excise duty to the fuel mixture ‘diesel/vegetable oil esters’. The reductions in excise duties cannot exceed EUR 35,06/hl or EUR 396,64/t for vegetable oil esters.
  The French legal arrangement is based on Article 25 of the amending finance law of 1997, on Decree No 98-309 of 22 April 1998 laying down the requirements for participation in the invitation to tender for the release for home use in France of biofuels giving rise to a reduction in domestic consumption tax, and on the decision of 22 April 1998 setting up the Committee for the examination of authorisation requests by biofuel production units. |
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1.

The normal rates of excise duties applicable to diesel used as a propellant are currently EUR 389 and EUR 440 for thousand litres in France and Germany respectively.

Germany, according to § 1 Abs. 2 Mineralölsteuergesetz i.V.m. § 1 Abs. 2 Nr 1 Mineralölsteuerdurchführungsverordnung, grants a full tax exemption to 97 % pure biodiesel sold in Germany. In practise, this tax exemption applies mostly to methyl esters having a vegetable origin (including rapeseed).

The German legislation is based on Article 8(2)(d) of Council Directive 92/81/EEC of 19 October 1992 on the harmonization of the structures of excise duties on mineral oils (1). The Commission has not yet examined in depth whether this article is appropriate; however, the Commission's proposal for a special regime for the taxation of biofuels, which is likely to be adopted in the coming months, has taken this specific situation by a so-called ‘grand-fathering’ clause (Article 8c paragraph 3) into account. This clause would allow Member States, which on 1 January 2001 totally exempted products solely made up of biofuels, continue to totally exempt these until 31 December 2003.

1

France has been authorised by the Council to grant permits for the application of a differentiated rate of excise duty to the fuel mixture ‘diesel/vegetable oil esters’. The reductions in excise duties cannot exceed EUR 35,06/hl or EUR 396,64/t for vegetable oil esters.

The French legal arrangement is based on Article 25 of the amending finance law of 1997, on Decree No 98-309 of 22 April 1998 laying down the requirements for participation in the invitation to tender for the release for home use in France of biofuels giving rise to a reduction in domestic consumption tax, and on the decision of 22 April 1998 setting up the Committee for the examination of authorisation requests by biofuel production units.

| 2. | The Commission does not know why Total-Elf-Fina has decided to sell diesel containing a percentage of rapeseed methyl ester. |
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2.

The Commission does not know why Total-Elf-Fina has decided to sell diesel containing a percentage of rapeseed methyl ester.

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(1)  OJ L 316, 31.10.1992.

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