A judgement issued on Thursday by the European Court of Justice (ECJ) has thrown Austria's energy tax system into disarray and disappointed business leaders and policy-makers in other member states. It confirms that member states must gain approval under EU state aid rules if they wish to exempt whole industry sectors from energy tax measures. This is a lengthy process that several governments want to avoid.
At the heart of the judgement is its conclusion that Austria's energy tax rules under which energy-intensive manufacturers get automatic rebates should have been vetted by the European Commission. Austria failed to submit the rebate system for approval. Early indications suggest that the Commission would be likely to reject it as anti-competitive.
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