EU tax exemptions for fuel are harmful subsidies that reduce the costs of fishing, therefore leading to an increase of fishing capacity, and thus contributing to overfishing in the European Union. Since 27 October 2003, energy products supplied for use as fuel for the purpose of navigation within EU waters, including fishing, are exempted from taxes. For years, these indirect support mechanisms by EU Regulations have added to the direct subsidies with which the EU has supported the fishing industry. In this study, we demonstrate the vastness of this indirect support through fuel tax exemptions and the scale of resulting CO2 emissions, and preview the impact of the proposed tax exemption elimination by the European Commission under the review of the Energy Taxation Directive (ETD).
“The question is, why do EU finance ministers under the lead of the Belgian Presidency seem unable to make the decision to move away from fossil fuel subsidies towards other types of tax benefits, or other subsidies that would incentivise the decarbonization process of the fisheries or maritime transport sectors, and would lead to a much-needed carbon-free EU economy?”