The Commission's forward programme
75. A striking feature of the evidence we received
was that, irrespective of their particular views on fuel duty,
witnesses argued strongly that it was not appropriate to consider
changes to this particular tax prior to and independently of the
Commission's as-yet-unpublished proposals on the broader reform
of transport taxation (centred on the forthcoming Framework Directive
on Infrastructure Charging). To cite one of numerous examples:
"CfIT's view is that it is not appropriate to consider different
elements of the charging framework in isolation, since the different
elements of the framework address different components of transport's
wider costs in a complex and interdependent way" (p 18).
76. In its defence, the Commission argued that
it was not "realistic" to propose "a very complex
package of measures" at one and the same time. "We already
have this particular proposal [
] we are coming up very soon
with ideas regarding infrastructure charging [
] It is a
gradual progress across a number of fronts" (Q3). Moreover,
these two proposals come under the jurisdiction of two separate
Councils: the EcoFin Council decides on any proposals to change
fuel tax whereas the Transport Council would decide on the Framework
77. Granted that not all measures can be proposed
in a single directive, the expert view was, as Professor Goodwin
"that the sequence of policy development should
be exactly the opposite of what the Commission is proposing. The
first priority is to develop ways of making transport prices more
sensitive to variations in environmental impact and congestion
caused" (p 28).
78. The ECMT and Professors McKinnon and Nash
all argued that a reduction in UK fuel duty could become appropriate
if and when a sufficiently comprehensive set of distance charges
were put in place for all road userswhilst arguing strongly
against the proposed reduction in fuel duty taken in isolation.
Professor Nash concluded that this proposal was "premature"
(p 33). In short, the view was that (a) the first priority should
be the introduction of distance charges tailored to the variations
in environmental impacts, and (b) it was not possible to establish
the "right" level of duty on fuel without undertaking
the broader reform of transport taxation, including the priority
task of introducing distance charges.
79. In any event, the adoption of the Energy
Tax Directive will reduce the scope of the Commission's proposal
on fuel tax to only a modest increase in regard to excise duty
rates on diesel in some countriesalongside a larger reduction
in othersand no change at all in regard to excise duty
rates on petrol. The only significant impact of the present proposal
is thus the large reduction in diesel fuel duty rates in the UK
and other large Member States.
Key conclusions on the Commission's
80. In view of the agreement on the Energy
Tax Directive, the Committee recommends that the Commission withdraw
the present proposal. The Commission should bring forward its
proposed Framework Directive on Infrastructure Charging before
any further discussion of the reform of fuel taxation.
81. The Committee considers that the Commission
should coordinate the development of its legislative proposals
so as to ensure coherence between its taxation, transport and
environmental policy objectives.