Need for zero excise duty on agricultural fuel in Greece

Under Directive 2003/96/EC, Member States may apply a level of taxation down to zero to energy products and electricity used for agricultural, horticultural or piscicultural works, and in forestry. A number of Member States have availed themselves of this opportunity, particularly to ensure supplies of cheap agricultural fuel.

However, under the third Memorandum, Greece was required by the Troika to increase excise duty for agricultural fuel from EUR 66 to EUR 200 per 1 000 litres (Law 4336/2015). From 1 October 2016 it must be increased to EUR 330 per kilolitre, bringing it fully into line with excise duty on automobile fuel.

In view of this:

Can the Commission say who was responsible for the recommended increase in excise duty on agricultural fuel under the third Memorandum and indicate the reasons for it?

What stance will the Commission, as a member of the Troika, adopt if the Greek Government decides to push for: (a) a zero rate of excise duty on agricultural fuel (heating gas oil) under Article 15(3) of Directive 2003/96/EC, or (b) minimum levels of taxation, that is to say EUR 21 per kilolitre, as specified in Article 8 (1) and (2a) thereof?

Source: European Parliament

Answer given by Mr Moscovici on behalf of the Commission

Taxation is a field of shared competence between the EU and its Member States. Directive 2003/96/EC(1) concerning taxation of energy products and electricity provides for minimum levels of taxation and mandatory exemptions as well as optional tax exemptions in particular for gas oil used in agriculture. Directive 2003/96/EC leaves it to the Member States to decide on the national level of taxation above the EU minimum and whether to avail themselves of the tax exemption. As part of the commitments undertaken by Greece in receiving financial assistance from the European Stability Mechanism (ESM) and in order to achieve the targets set for the primary surplus, the Greek Government committed to taking measures to raise revenues. One of such measures is to gradually abolish the refund of excise tax on diesel oil for farmers, in two equal steps in October 2015 and October 2016. The Greek Government has also committed to monitor fiscal risks and take offsetting measures as needed to meet the fiscal targets. All the fiscal measures that Greece intends to take for ensuring sustainable public finances and achieve sizeable and sustainable primary surpluses over the medium-term are described in the memorandum of understanding (MoU) signed by Greece and the Commission, acting on behalf of the ESM(2). The Commission, in liaison with the European Central Bank (ECB), and whenever possible with the International Monetary Fund (IMF), monitors progress in implementing the adjustment programme of Greece and assesses compliance with the policy conditions set in the MoU. (1) OJ L 283, 31.10.2003. (2) http://ec.europa.eu/economy_finance/assistance_eu_ms/greek_loan_facility/pdf/01_mou_20150811_en.pdf