Fragile deal on EC carbon tax leaves UK out in the cold

Agreement on the proposed EC carbon/energy tax drew closer on 23 April when eleven of the 12 Member States accepted in principle that a tax is needed to help the Community reduce its carbon dioxide emissions. The UK was the only dissenter, but the compromise which made the agreement possible, based on tax exemptions for countries with CO2 emissions per head lower than the EC average, is a fragile one. The EC has also yet to decide whether the new energy taxes proposed in the USA are high enough to meet its condition that other industrialised nations must take similar action before it goes ahead with its own tax.

The current Danish Presidency of the EC made it plain in January that it would strive to get an agreement on the tax by June, and the meeting of Energy and Environment Ministers on 23 April was the latest step in that process. The next crucial step will be on 7 June at a meeting of Ecofin, the Council of Finance Ministers, which has taken to itself the right to take the final decision on the tax.

The Danes had already scored one success a

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