Economy Minister Giancarlo Giorgetti has been repeating this for days in increasingly harsh tones. Regarding the direction of taxation of energy products that will be discussed from next Thursday at Ecofin, “Italy will go to war”. And he is also ready to veto it. Those who spoke to Giorgetti in recent hours reported that if the minister signed this directive it would be equivalent to “assisted suicide” for Italy. Dte, which is the acronym for the Commission’s legislative proposal, is one of the roots planted in another era and today risks allowing toxic fruits to ripen. The underlying principles are the principles that underlie the entire green system designed by Europe during Ursula von der Leyen’s first presidency, namely the stubborn green principles of the then climate commissioner, Frans Timmermans. This means “the polluter pays”. And according to the proposed directive on the taxation of energy products, everyone who uses fossil fuels will have to pay. That means more taxes on gas, coal and oil. The point, which is by no means secondary, is that this idea was born in 2021 (the proposed directive has been discussed since then), before Russia’s invasion of Ukraine, before the closure of Moscow’s gas pipelines (one of them, the Northern Line, was even blown up) and before Italy’s Eni went to great lengths to find a molecule worldwide that could hold down prices not only for Italy but also for the entire Old Continent. Despite this, currently the price of gas traded on the Dutch TTF market is still above 30 euros, double the level before the invasion.
STEPS
Consumers, who pay higher bills, know this well, governments, such as the Italian government, which has had to allocate billions of dollars to help families facing high bills, know this well, and the business world knows this too, especially companies that waste energy and are at risk of being abandoned. And that is precisely what Giorgetti probably had in mind a few days ago, when answering a question in the House regarding the budgetary maneuvers, he said that in Ecofin there would be “a big discussion regarding the energy taxation directive”, a directive “which is born in 2021, in a very different world from today”, and that the approach of the provision “will radically kill Italian industry because it increases taxes on natural gas, which is the main resource where we work”. That Italy uses mostly methane is no mystery. But the impact of the directive, at least in its original form, while waiting to know the details of the “compromise” proposed by the Danish presidency, will also be felt on families. In Italy, unlike some Northern European countries, heating and hot water in homes is mostly produced with gas. Increasing customs duties will lead to an increase in billing costs.
Perhaps this is also the reason why in Brussels the winds that have begun to blow against the directive seem to be increasingly against it. “The reform of the European directive on energy taxation is still far from being agreed between countries and the road remains uphill,” a Commission source told Ansa. Among the Twenty-Seven countries, it underlined, “conflicting red lines” still exist on various matters, despite progress in bilateral negotiations. “The work is progressing, but the road is uphill, as are many issues related to the green transition”, explained the same source. The Danish Presidency plans to finalize the document by the end of this year. The aim is to update the outdated regulatory framework, aligning energy excise rates with Europe’s climate goals.
CONSEQUENCE
In short, we are back to square one: more taxes on those who destroy the environment. However, increasing production system costs have consequences. Confindustria President Emanuele Orsini recalled it yesterday at the Federacciai meeting. “The real danger for European industry today”, said the number one industrialist, “comes from China which is encouraging the use of gas and fossil fuels to maintain competitiveness”. This comes as “Europe continues to implement increasingly stringent restrictions, losing competitiveness and pushing towards deindustrialization”, explains Orsini. The numbers are pretty clear. “From January to September”, the president of Confindustria underlined, “Chinese exports to America decreased by 14 percent, but to Europe increased by 9 percent. It is clear that Europe is becoming their main commercial outlet.” In short, in a context like this, taxing the fossil fuels consumed in Europe seems like a step towards the brink of collapse. However, because this is a tax issue, it requires a unanimous vote from all countries. In short, there is a margin to stop a new Euro strike.
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