HELSINKI, Sept. 14 (Xinhua) -- The finance ministers of members of the European Union on Saturday discussed options of changing the EU energy legislation to adapt to the climate change combat.
Air travel taxation got attention, but with emphasis on the needs to take into account the competitiveness matter.
Mika Lintila, the Finnish finance minister, said in a statement that it is "difficult to envision air travel taxation without the taxes being global".
Valdis Dombrovskis, Vice-President of the European Commission, said a number of member states, especially those that are "isolated", expressed concern about the adverse impact of any aviation tax.
"When we are discussing European green deal and transition into carbon neutral economy, competitiveness and social impact needs to be taken into account," said Dombrovskis.
He recalled that when the EC announced the European Green Deal, it also published a "just transition fund" to help regions most affected by the transition.
The 2003 EU energy tax directive includes no aviation tax. Dombrovskis noted that it was investigated in the meeting on Saturday where consensus could be reached on themes much wider than just aviation taxation.
Besides a possible aviation tax, the ministers also discussed changes in taxation rates of energy products, promotion of the use of renewable fuels, taxing on basis of CO2 emissions or energy efficiency.
"Further discussions will be needed. Today gave an indication of the level of ambition," Dombrovskis concluded.
FISCAL RULES
The finance ministers also discussed extensively the need to reform the fiscal rules of the European Union.
Dombrovskis said that "many colleagues said the current EU fiscal rules work reasonably well". He reminded that excessive budget deficits of EU countries have been brought down and the public debt level in the EU is decreasing.
"It is expected to be 80 percent of GDP, down from 88 percent in 2014." He added that "it is true that this has happened through economic growth, but it also indicates that EU fiscal governance works."
"Many members spoke in favor of more simplicity to increase transparency and predictability. We have to assess whether we can reach agreement on simpler rules without opening legislation," Dombrovskis said.
Dombrovskis told the press conference that the ministers largely accepted the ideas presented by the independent European Fiscal Board to focus the rules on debt and government spending. Analysts said such a focus would watch easily observable parameters.
Currently, the focus of the rules is on the "structural deficit" which is an artificially calculated parameter. The Fiscal Board noted, for example, the whole process of surveillance of adherence to the rules has led to bilateralization where the commission discusses with member states separately.
The EU rules are officially called the Stability and Growth Pact, dating back to 1997, but have been overhauled several times. The rules limit the nominal budget deficit to three percent of GDP and give a cap on public debt at 60 percent.
