European Commission allows tax relief for Danish ETS companies

17 June 2009 12:43  [Source: ICIS news]

BRUSSELS (ICIS news)--Denmark can grant carbon dioxide tax relief to companies covered by the EU’s Emissions Trading Scheme (EU ETS), subject to certain conditions, the European Commission said on Wednesday.

The Commission ruled that under EU state aid law, Denmark can offer companies tax relief as long as they continue to pay minimum rates for energy taxes as set out in the EU Energy Tax Directive.

After an investigation that began in September 2006, the Commission said it had concluded that “if the proposed full tax exemption would be implemented, some of the environmental objectives which a tax on energy products aims to achieve would be lost”.

Brussels was also concerned that a full tax exemption would "distort competition by increasing tax differentiations in an area where the EU has harmonised taxes and set tax minima to create a level playing field between companies".

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By: Philippa Jones
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