EU to use taxation to protect the environment

The European Commission will soon come up with ideas for 'green taxes' to save energy and cut greenhouse gas emissions, officials said yesterday.

EU political leaders agreed this month to set targets to reduce emissions and increase the use of renewable energy and taxation will be a key tool to reach these objectives, EU Tax Commissioner Laszlo Kovacs told a conference.

"I would like to use a Green Paper to launch possible ways forward on energy taxes at EU level," Mr Kovacs said.

Taxes can steer the bloc's 500 million consumers towards a more efficient use of resources with the revenues recycled back into the economy, he said. Taxation at the EU level is just as electorally unpopular as at the national level but need unanimity among the bloc's 27 members. But the newly agreed deal by states to cut emissions and people's willingness to help the environment mean these barriers were no longer insurmountable, Mr Kovacs said.

"The taxes that people are most inclined to pay are environmental taxes because they do understand that what is at stake is the future of mankind," Mr Kovacs said.

Mr Kovacs and EU Environment Commissioner Stavros Dimas will publish ideas on how taxes can be used to cut emissions.

"Market-based instruments are the most direct and simplest way to make the polluter pay,"

Mr Dimas said, adding "There is a logic for action at EU level."