The Rio Earth Summit of 1992 increased awareness on sustainable development, while the EU 5 th Environmental Action Programme focused on new policy tools such as economic instruments (ecotaxes, emission trading, ecolabels, product policy etc.). At the same time, the EU set minimum tax rates on motor fuels and some other energy products; Member States were able to apply higher rates (most actually do) but not lower. The same year, the European Commission put forward a new Energy/CO 2 tax directive, with a strong environmental protection content, that failed to be adopted.

In 1997, following the failure of the 1992 proposal, the European Commission proposed a new energy taxation directive that would extend the minimum rates to natural gas, coal and electricity, and would considerably increase the 1992 minimum rates on energy products.

In 2001 the European Commission proposed a directive for an Emission Trading EU system.

On 20 March 2003, the Economy and Finance Council of Ministers (ECOFIN) agreed on the 1997 energy taxation directive. The final text, however, is significantly different than the original text, notably in that the tax increases that are much lower.

In September 2003, the Parliament and the Council adopt the emission trading directive.

Also in 2003, the European Commission proposed a directive on diesel taxation (gradual harmonisation of the tax rates on professional diesel, alignment of the tax rates of non-professional diesel to that of petrol).

 
Aims

• Effective environmental fiscal reform in as many EU and Candidate Countries as possible, with as general objectives:

• Implementation of an ambitious and effective Environmental Fiscal Reform throughout Europe

• Changing consumption and production patterns towards greater sustainability

• Raising awareness about EFR among the public as well as among governments and private sector players

• Improving the quality of the political discourse on Environmental Fiscal Reform and overcoming resistance

• And with the following concrete campaign demands:

• An additional 10% shift in total tax revenue from labour to environmental use by 2010, at EU and national level

• Removal or reform of all environmentally adverse subsidies by 2005

• Energy saving and efficiency policies

• Fiscal incentives for environment protection

Activities

• Co-ordinating and strengthening the EEB Working group on EFR, organise two meetings.

• Maintain the information flow from the EU to the national levels and vice versa and produce its campaign newsletter.

• Publish material onenvironmentally damaging subsidies and the environmental and economical benefit of shifting subsidies (and tax-reductions) into an environmentally friendly direction.

• Seek coalitions within business, and strengthen working relations with trade unions and social organisations.

• Taxation:follow-up of the Diesel Tax Directive.

• Emission Trading Directive: EU Member States are currently working on their National Allocation Plans (NAPs). NAPs guidelines include a clause asking that other instruments, such as taxes, are also implemented in the sectors not participating in the emission trading scheme. The EEB has just published a position paper on NAPs and is working with its members in order to lobby national governments to design efficient NAPs.

• Subsidies:the EEB is working on a 'subsidies check-list' that aims at helping NGOs identifying and tackling environmentally harmful subsidies. The EEB is also checking EU and OECD initiatives in terms of environmentally harmful subsidies.