EU pledges quick move on tax for polluting firms

BRUSSELS: The European Commission will quickly start work on a tax on foreign polluting firms, the nominee for the EU’s economic and tax commissioner said on Thursday, a move that could hit US companies and deepen a trade war with Washington.
In his confirmation hearing before EU lawmakers, Italy’s Paolo Gentiloni also pledged “adequate” fiscal efforts to counter an economic slowdown in the euro zone that he said could be longer than currently expected.
“We will try to be very quick and effective on a carbon border tax,” Gentiloni, who is due to take office in November, said.
He warned of legal and technical hurdles in devising the levy, but said work would start immediately to make sure the tax would be compatible with World Trade Organisation rules.
The tax is meant to shield European companies from competitors based in countries where climate protection schemes are not as strict.
President Donald Trump intends to pull the United States out of the international Paris climate protection deal that aims to reduce carbon emissions. Under the terms of the pact, that cannot happen before November 4, 2020.
Previous European commissions have resisted calls, led by steel makers and traditionally protectionist France, for a carbon levy, but fresh momentum has come from increased prices in the EU Emissions Trading System (ETS), the European Union’s flagship instrument for making polluters pay.
— Reuters