TAX reductions and other measures to help the poor and those hardest pressed by rising oil prices, including the fisheries and transport sectors, are to be proposed by the European Commission.
Heating oil has increased by a third in the past year while petrol and diesel has jumped by more than 12%, and this trend will continue, a Commission report warned.
A series of measures to tackle the spiralling cost of fuel that is hitting the EU economy and adding to food prices will be considered by EU leaders when they meet in Brussels in two weeks time.
In the autumn, the Commission will propose how tax incentives, including reducing VAT rates, can work to encourage everyone to be more energy-efficient.
However, in the longer term, the answer must be to reduce Europe’s growing dependence on imported fossil fuels, the Commission said.
“Member states must introduce targeted measures to support the poorest citizens hardest hit by the current situation, especially those really in need,” said Johannes Laitenberger, Commission spokesperson.
Households and the less privileged must be helped and so must different industry sectors hardest hit by the price hikes, such as fisheries, agriculture, transport, the chemical and automotive sectors.
The idea of a “Robin Hood tax” — a tax on companies making massive profits from the increase in fuel prices to be used to subsidise those suffering the effects of such high prices — will also be considered, he said.
On fisheries, where the Commission is proposing further reductions in fleets and the quantity of fish caught because of over-fishing, Mr Laitenburger said that changes must be made to ensure Europe has a fishing industry in the future.
“But we do not overlook the hardships people are facing and we must make sure that the impact is cushioned in both economic and social terms,” he added.
The Commission is carrying out a strategic energy review and analysis of the oil market and the oil stocks held by EU member states.
The current surge in oil prices, which have reached their highest level in real terms since the end of the ’70s, is due to the huge extra demand from China and India in particular.
Other temporary factors, such as the weak dollar and difficulties with specific pipelines and extraction, have also contributed to the price rise.
© Irish Examiner Ltd. All rights reserved