Proposal for a Council Decision authorising Belgium, in accordance with Article 8(4) of Directive 92/81/EEC, to apply a differentiated rate of excise duty to low-sulphur diesel and unleaded petrol
Date: 2001-04-26
Institutions: European Commission
Subjects: Belgium, diesel fuel, excise duty, petrol, pollution control measures, tax harmonisation

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 26.04.2001
COM(2001) 223 final

Proposal for a

COUNCIL DECISION

authorising Belgium, in accordance with Article 8(4) of Directive 92/81/EEC, to apply a
differentiated rate of excise duty to low-sulphur diesel and unleaded petrol

(presented by the Commission)

EXPLANATORY MEMORANDUM

1.

SUBMISSION OF REQUEST

In a letter dated 2 February 2001, supplemented by a letter dated 14 February 2001, Belgium
informed the Commission that it wanted to introduce a differentiated rate of excise duty on
unleaded petrol and diesel fuel with a sulphur content not exceeding 50 particles per million
(ppm) under Article 8(4) of Council Directive 92/81/EEC on the harmonisation of the
structures of excise duties on mineral oils.1

The terms “low-sulphur petrol” and “low-sulphur diesel” refer to petrol and diesel with a
sulphur content meeting the 50 ppm environmental criterion laid down in Directive 98/70/EC
of the European Parliament and of the Council of 13 October 1998 relating to the quality of
petrol and diesel fuels.2

Belgium explains that the purpose of the proposed reduction is to encourage the sales of these
environmentally-friendly products. The tax reduction is necessary to offset
the cost of
desulphurisation and the removal of certain aromatics and to make the product slightly
cheaper at the pump than what is currently available.

Excise duties would thus be reduced by BEF 0.65/litre for 98 and possibly 95 RON petrol and
diesel fuel containing less than 50 ppm sulphur and aromatics. These reductions would be
available to all users of these types of fuel.

The measures must enter into force on 1 May 2001 and 1 October 2001 respectively for
50 ppm unleaded petrol and diesel. No expiry date is envisaged at this stage.

The Belgian authorities consider that this measure does not constitute state aid, since it affects
everyone without discrimination, including persons not living in Belgium.

2.

THE COMMISSION’S ASSESSMENT

Under Article 8(4) of Council Directive 92/81/EEC on the harmonisation of the structures of
excise duties on mineral oils, the Council, acting unanimously on a proposal from the
Commission, may authorise any Member State to introduce exemptions from, or reductions
in, excise duties on grounds of specific policy considerations.

By letters dated 2 February 2001 and 14 February 2001, Belgium requested authorisation to
introduce a differentiated rate of excise duty on low-sulphur (50 ppm) unleaded petrol and
diesel from 1 May 2001 and 1 October 2001 respectively.

In accordance with Directive 92/81/EEC, the other Member States have been informed of this
request.

1

2

OJ L 316, 31.10.1992, p. 12, Directive as last amended by Directive 94/74/EC (OJ L 365, 31.12.94,
p. 46).
OJ L 350, 28.12.1998, p. 58, Directive amending Council Directive 93/12/EEC (OJ L 74, 27.3.1993,
p. 81).

2

Following the implementation of the planned measure,
charged on fuels in Belgium will be as follows:

the differentiated excise duties

€

(in

per 1000 l)

Unleaded
petrol

Diesel

Minimum Community rates

Excise duty on conventional
fuels

Excise duty on 50 ppm fuels

287

494

477

245

290

274

The differentiated rates of excise duties will thus comply with the minimum Community rates
laid down in Articles 4 and 5 of Directive 92/82/EEC.3

Following a thorough study of the measure and acknowledging the importance of tax
incentives to promote cleaner fuels, the Commission notes that the reduction of excise will be
of general application, in other words the reduced rate will be available to anyone filling up
with low-sulphur fuels in Belgium.

The derogation is sought on environmental grounds - the benefits in terms of air quality are
known.

The availability of sufficient quantities of these fuels, of a satisfactory quality, has been
verified.

the measure to
the period of application of
The Commission intends
31 December 2004,
the day before use of this type of fuel becomes mandatory under
Directive 98/70/EC of the European Parliament and of the Council of 13 October 1998
relating to the quality of petrol and diesel fuels.

to limit

The Commission notes that on 12 March 2001 the Council allowed the Netherlands to apply a
reduced rate of excise duty on 50 ppm diesel fuel. The Council has also authorised a
derogation under Directive 92/81/EEC for 50 ppm fuels in Germany.4

3.

DECISION

In accordance with Article 8(4) of Council Directive 92/81/EEC, the Commission proposes
that the Council authorise Belgium to apply a differentiated rate of excise duty of a maximum
of BEF 0.65 per litre on low-sulphur (50 ppm) unleaded petrol and diesel fuel until
31 December 2004.

3

4

OJ L 316, 31.10.1992, p. 19, Directive as last amended by Directive 94/74/EC (OJ L 365, 31.12.94,
p. 46).
Decision 2000/283/EC of 10 April 2000 authorises Germany to apply, from 1 November 2001 to
31 December 2002, a differentiated rate of excise duty to fuels with a sulphur content not exceeding
50 ppm provided that the obligations of Council Directive 92/82/EEC of 19 October 1992 on the
approximation of the rates of excise duties on mineral oils are complied with, in particular the minimum
rate of excise duty laid down in Articles 4 and 5 thereof.

3

Proposal for a

COUNCIL DECISION

authorising Belgium, in accordance with Article 8(4) of Directive 92/81/EEC, to apply a
differentiated rate of excise duty to low-sulphur diesel and unleaded petrol

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to Council Directive 92/81/EEC of 19 October 1992 on the harmonisation of
the structures of excise duties on mineral oils,5 and in particular Article 8(4) thereof,

Having regard to the proposal from the Commission,

Whereas:

(1)

(2)

(3)

(4)

(5)

5

6

7

Under Article 8(4) of Directive 92/81/EEC, the Council, acting unanimously on a
proposal from the Commission, may authorise any Member State to introduce
exemptions or reductions in the excise duty charged on mineral oils for specific policy
considerations.

Belgium has requested authorisation to apply a differentiated rate of excise duty to
low-sulphur
from 1 May 2001 and
1 October 2001 respectively. This differentiation of BEF 0.65 per litre is available to
all users of these types of fuel.

(50 ppm) unleaded petrol and diesel

Low-sulphur fuels comply with the environmental criterion (50 ppm) laid down in
Directive 98/70/EC of the European Parliament and of the Council of 13 October 1998
relating to the quality of petrol and diesel fuels.6 Under Articles 3 and 4 of that
Directive, the use of 50 ppm fuels will be compulsory from 1 January 2005.

The other Member States have been informed of this request by the Belgian
authorities.

The measure envisaged by Belgium complies with the minimum rates of excise duty
referred to in Articles 4 and 5 of Directive 92/82/EEC.7

OJ L 316, 31.10.1992, p. 12, Directive as last amended by Directive 94/74/EC (OJ L 365, 31.12.1994,
p. 46).
OJ L 350, 28.12.1998, p. 58, Directive amending Council Directive 93/12/EEC (OJ L 74, 27.3.1993,
p. 81).
OJ L 316, 31.10.1992, p. 19, Directive as last amended by Directive 94/74/EC (OJ L 365, 31.12.94,
p. 46).

4

(6)

(7)

(8)

(9)

The measure is sought on environmental grounds - the benefits in terms of air quality
are known.

On the information available at present, neither the Commission nor the Member
States consider that the application of a differentiated rate of excise duty on low-
sulphur fuel will cause distortions of competition affecting the common interest or
hinder the operation of the single market.

This Decision does not prejudice the outcome of any future state aid procedures that
may be undertaken in accordance with Articles 87 and 88 of the Treaty, nor does it
override the requirement for Member States to notify instances of potential state aid to
the Commission under Article 88 of the Treaty.

The Commission regularly reviews reductions and exemptions to check that they do
not distort competition or the operation of the internal market or are incompatible with
Community environmental policy.

(10)

The Council will review this decision on the basis of a proposal from the Commission
no later than 31 December 2004, when the authorisation granted by this decision
expires,

HAS ADOPTED THIS DECISION:

Article 1

1.

2.

3.

In accordance with Article 8(4) of Council Directive 92/81/EEC, Belgium is
authorised to apply a differentiated rate of excise duty on low-sulphur (50 ppm)
unleaded petrol from 1 May 2001.

In accordance with Article 8(4) of Council Directive 92/81/EEC, Belgium is
authorised to apply a differentiated rate of excise duty on low-sulphur (50 ppm) diesel
fuel from 1 October 2001.

These differentiated rates, not exceeding BEF 0.65 per litre of fuel, must comply with
the terms of Council Directive 92/82/EEC of 19 October 1992 on the approximation
of the rates of excise duties on mineral oils,8 and in particular the minimum rates laid
down in Articles 4 and 5 thereof.

The differentiated rates must be accorded to all users of 50 ppm fuel purchased in Belgium,
without discrimination.

Article 2

Article 3

Subject to a prior review by the Council, on the basis of a proposal from the Commission, this
authorisation shall expire on 31 December 2004.

8

OJ L 316, 31.10.1992, p. 19, Directive as last amended by Directive 94/74/EC (OJ L 365, 31.12.94,
p. 46).

5

Article 4

This decision is addressed to the Kingdom of Belgium.

Done at Brussels,

For the Council
The President

6