No more duty-free fuel for yachts

The European Commission has turned down a request by the government for duty-free fuel to continue to be sold to yachts and pleasure aircraft.

Under its accession treaty Malta was granted a transitional derogation, until the end of 2006, before it must end the system of selling duty-free fuel for yachting and pleasure aircraft purposes, which is not normally permitted under EU law. Even so the government was hoping for an extension to this concession and had made an official request to the Commission.

It had argued that the concession was important for the development of its maritime and the pleasure aviation industry. However, the Commission countered that fuel tax derogations do not help competition.

A spokesman for the Commission said the official decision was made last week: "...such derogations go against community environmental policy and there is no reason why private use of these means of transport should be given preferential treatment".

The Commission has turned down similar applications from Belgium, the UK, France, Sweden and Portugal.