Warning of ‘green levies’ threat to single market

Date: 02/05/1996

By Michael Mann

EUROPEAN business chiefs are warning that the increasing use of “green levies” by EU member states could pose a major threat to the single market.

As the Commission prepares guidelines on how far member states can go in using financial incentives to protect the environment, industry is stressing that this is a unique opportunity to set tough parameters.

The employers' federation UNICE claims the Commission's proposals will be so vague that member states will be able to introduce taxes on a range of products without proof that they are fully justified on environmental grounds.

Stressing that it does not question the use of fiscal instruments for environmental purposes, industry is concerned that measures are often brought in without sufficient proof that they represent the best way of cutting waste and pollution.

Given recent controversy over the German packaging ordinance and the proposed Luxembourg eco-tax, there is growing concern that member states could use environmental justifications as a pretext for erecting barriers to imports from other EU countries.

Commission officials believe their guidelines will prevent foul play, but their ideas look set to receive a rocky reception.