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EU finance ministers weigh aviation tax, fossil fuel levies in Helsinki

Finance Minister Mika Lintilä called for a ban on beef from Brazil to pressure its government over the Amazon fires.

Finlandia-talo.
EU finance ministers met at Finlandia Hall on Friday and Saturday. Image: Antti Lähteenmäki / Yle

EU finance ministers wrapped a meeting in Helsinki on Saturday, with the focus on energy taxes and stronger measures to mitigate climate change.

Hosted by Finance Minister Mika Lintilä at Finlandia Hall, the conference began on Friday with resilience to hybrid threats as the main theme. The ministers agreed that the financial sector must beef up its capacity to combat hybrid threats and infrastructure disruptions.

As it was an informal meeting, no concrete decisions were expected and little information has been released officially.

Finland, which holds the rotating six-month EU presidency, aimed to focus on economic policies' impact on the climate and environment, with strong backing from Germany, France and others.

The news agency Reuters cites unnamed top officials as saying on Friday that the EU is considering new energy taxes, including on the aviation sector, to meet its climate targets.

Scholz: International emissions trading needed

While the EU has led the global shift towards renewable energy over the past decade or so and established the world's biggest emissions trading system, its energy taxation rules have not been updated in more than 15 years.

They are "outdated and poorly adapted to climate change challenges and developments in energy policy at EU level," said a draft document discussed in Helsinki, according to Reuters.

Possible measures listed in the document prepared by the Finnish presidency are higher minimum tax rates on energy, fossil fuel levies and the end of waivers for the air and sea transport sectors.

German Finance Minister Olaf Scholz said "drastic steps" are needed to counter climate change, urging a more international approach on emissions trading.

"We are currently in a situation where many say 'we'd like to do something on a national level, but no one else is,'" he told DW.

"We're in the process of finding out how we can limit CO2 consumption in agriculture, small businesses or transport," he added.

Le Maire: Aviation must contribute more

His French counterpart, Bruno Le Maire, called on tougher measures on Europe's airlines, which now enjoy tax exemptions and other waivers to help it compete with those outside the bloc.

According to Le Maire, the aviation sector must step up and contribute more to climate measures "either with taxes or with the purchase of more allowances" from the EU's emissions trading system.

Dombrovskis: Energy taxes must be reformed

At a press conference on Saturday afternoon, the EU's top economic commissioner, former Latvian PM Valdis Dombrovskis, told reporters that options also included a carbon tax and an overhaul of energy taxation, an area where "EU rules are clearly out of step with the considerable evolution of technology and energy markets over the past 15 years," he said.

Dombrovskis reiterated "the Commission's view that energy taxation has a key role to play in achieving the Union's climate and environmental objectives".

"There are a number of possible solutions to address the main challenges we are facing," he said. "Some countries raised the option of aviation taxation, tackling the imbalances between the tax rates of energy products such as diesel and petrol, or promoting the use of renewable energy and increasing energy efficiency."

He promised that the next Commission will take these all into consideration as it prepares a plan known as the European Green Deal.

"We must make concrete progress on this issue during the next mandate because we must live up to the promises we have made to Europeans on climate and environmental issues," said Dombrovskis.

Ambitious targets for reducing carbon emissions by at least 50 percent by 2030 are part of the agenda of the new European Commission, which is to take office in November. Finland argues that in order to achieve EU carbon neutrality by mid-century, the 2030 emissions reduction goal must be tightened to at least 55 percent.

Lintilä seeks Brazilian beef boycott

On Friday, Lintilä called for an EU block on imports of Brazilian beef and perhaps soybeans to put pressure on the Brazilian government to counter wildfires in the Amazon, which are blamed for boosting CO2 levels in the atmosphere.

Finland, in its capacity as European Council president, has asked EU authorities to "discontinue the import of beef from Brazil," he told reporters.

He added that he was considering doing the same about soybeans with the aim of "increasing pressure, so the Brazilian government would do something on forest fires."

Starting next Sunday, EU agricultural ministers will hold an informal meeting in Helsinki to discuss soil carbon sequestration as a way to slow climate change. The ministers are to visit a Finnish farm and a forest management site, hosted by Minister of Agriculture and Forestry Jari Leppä.

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