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"Neutrality" should not be imposed to deprive diesel of its tax advantage over petrol, said a majority of MEPs in Thursday's vote on a proposal to reform energy taxation. The Commission is proposing that the advantage it enjoys in most countries should be phased out.

The European Parliament's non-binding position - adopted with 374 votes in favour, 217 against and 73 abstentions - provides recommendations the Council of Ministers, which must decide unanimously for any changes to take effect.

The lead MEP on the proposal, Astrid Lulling (EPP, LU) backed the proposal's aim of combating climate change but opposed tax neutrality on the grounds that it would lead to a diesel price hike.

The proposal

The Commission proposes that energy taxes should be in two parts: the first specifically linked to CO2 emissions and the second based on the energy content of products. This is intended to help the EU combat climate change, promote the use of renewable energy sources and support technological change and investment in the green economy.

Other areas

MEPs support the possibility for Member States to apply reduced or zero taxes in certain areas, such as agricultural or forestry activities. However policies in these sectors must be linked to energy efficiency efforts, says the text.

Current energy tax exemptions or reductions for households and charitable organisations should gradually be phased out, but over a long period, say MEPs.  In Member States where this affects energy prices, low-income households and charities should be compensated via solid and comprehensive social measures.

Finally, Member States should ensure both that CO2 taxation does not apply to industry sectors that are already subject to the EU emissions trading scheme, and that sectors outside the scheme are not penalised by comparison with those that are.

Procedure:  Consultation, Single reading