17. 6. 91 Official Journal of the European Communities No C 159/1 
II 
(Preparatory Acts) 
ECONOMIC AND SOCIAL COMMITTEE 
Opinion on the proposal for a Council Directive fixing certain rates and target rates of excise 
duty on mineral oils (*) 
(91/C 159/01) 
On 11 March 1991 the Council decided to consult the Economic and Social Committee, 
under Article 198 of the Treaty establishing the European Economic Community, on the 
abovementioned proposal. 
The Section for Economic, Financial and Monetary Questions, which was responsible for 
preparing the Committee's work on the subject, adopted its Opinion on 12 April 1991. The 
Rapporteur was Mr Petersen. 
At its 286th plenary session (meeting of 24 April 1991), the Economic and Social Committee 
unanimously adopted the following Opinion. 
1. Introduction 
In December 1989 the Commission submitted a pro­
posal for the rates of excise duty to be applied to 
mineral oil from 1 January 1993 (2). In this proposal 
minimum rates were proposed for all mineral oil prod­
ucts. Rate bands (i.e. maximum and minimum rates) 
were laid down for road diesel, heating oil and heavy 
oil. A further proposal was announced which would 
establish the target (i.e. guideline) rates on which the 
tax rates of the Member States must in the long term 
converge. Target rates for the other types of excise duty 
have already been proposed in draft Directives. 
2. The Commission proposal 
2.1. To complement its December 1989 proposal the 
Commission is proposing target rates for petrol (leaded 
and unleaded) and kerosene used as a propellant. The proposed target rates are: 
Leaded petrol: 495 ECU per 1 000 litres; 
Unleaded petrol: 445 ECU per 1 000 litres; 
Kerosene used as a propellant (3): 495 ECU per 1 000 
litres; 
2.2. The rate band to be applied to road diesel as 
from 1 January 1993 is raised and widened. The Com­
mission justifies this step by pointing out that the 1989 
proposal made provision for a two-yearly adjustment 
of rates in the light, in particular, of environmental and 
transport considerations. 
The rate band for road diesel is fixed at: 245-270 ECU 
per 1 000 litres. 
2.3. The Commission states that the target rates and 
the higher road diesel band include a C02 supplement 
of 45 ECU per 1 000 litres. 
2.4. The Commission has not set any target rates 
for the other mineral oil products in view of their 
insignificant contribution to total revenue from min­
eral-oil excise duty (10% only). 
(!) OJ No C 66, 14. 3. 1991, p. 14. 
(2) COM(89) 527 final. (3) Except in commercial air transport. 
No C 159/2 Official Journal of the European Communities 17. 6. 91 
3. Comments 
3.1. The Commission proposal can generally be 
approved. The consideration given to ecological 
requirements is to be especially welcomed. 
3.2. The establishment of target rates is a necessary 
step towards greater convergence of national excise 
duties on mineral oils. The levels of the proposed target 
rates are considered a priori to be appropriate. How­
ever, the Committee would point to the serious shifts 
in taxation patterns, especially in Greece and Luxem­
bourg. In Greece's case, special rules should be adopted 
to make these shifts less marked; since Greece does not 
have a common frontier with any other Member State, 
competition will not be distorted. 
3.3. The consideration given to the problem of C02 
in the proposal deserves recognition. Experience shows 
however that at most, tax instruments have a one-off 
and short term guiding effect. It is the revenue aspect 
that tends to predominate. The attempt to alter con­
sumer habits for environmental reasons will of course 
not succeed in those Member States (Ireland, Italy and 
Portugal) where current excise rates are higher than the 
Commission's proposed target rates or rate bands and 
so would have to come down. In terms of environment 
policy, however, the proposal does give some sort of a 
signal. 
3.4. The retention of the rate differential between 
leaded and unleaded petrol is particularly welcomed. 
In a number of Member States unleaded petrol has 
already significantly increased its share of the petrol 
market, partly because of tax incentives. 
3.5. The widening of the rate band for road diesel 
can be expected to facilitate the process of convergence. 
It does however also increase the risk of distortions of 
competition in this area. Even small divergences in the 
rates of duty levied on road diesel provide incentives 
for tax evasion. 
Done at Brussels, 24 April 1991. 3.6. In some Member States, particularly the Benelux 
countries and Greece, the increase in the rate band 
for road diesel will lead to a considerable increase in 
taxation from 1 January 1993 at the latest, thereby 
noticeably pushing up the cost of road diesel in these 
countries. The rise will hit road haulage particularly 
and will mean increased transport and freight charges. 
Because of this, there could be substitution effects (a 
switch to other modes of transport) in some Member 
States. 
3.7. As the Committee made clear in point 3.1 of its 
Opinion CES 833/90 of 5 July 1990, the taxation of 
fuels cannot be treated in isolation. It has to be taken 
together with road tolls, road tax and any other charges 
arising from the ownership and use of motor vehicles, 
and overall harmonization has to be achieved in this 
area. The Commission has already submitted a draft 
Directive (!) to this effect. 
3.8. The Committee doubts the Commission state­
ment that an increase in excise duty on road diesel is 
also needed to help offset infrastructure investment. At 
least in some individual Member States revenue from 
mineral oil duty far exceeds funds invested in road 
construction and maintenance. Moreover, since revenue 
from excise duties is not earmarked for any specific 
purpose, there is no guarantee whatsoever that it would 
in fact be used for financing infrastructure projects. 
4. Final comment 
The Committee would welcome a consistent Com­
mission policy in other areas—such as research and 
development and road tax incentives for diesel engine 
passenger vehicles with lower exhaust emissions-
—which would ensure that the more rapid development 
of environment-friendly technologies is not impeded by 
restrictive harmonization measures. 
(!) COM(90) 540 final. 
The Chairman 
of the Economic and Social Committee 
Fran?ois STAEDELIN