France’s parliament has adopted the Socialist government’s 2014 budget, which imposes a carbon tax on gasoline, heating oil and coal.
The move comes despite widespread opposition to the “eco-tax” that would raise transportation costs.
The Socialists’ “energy transition” involves reducing energy consumption 50 percent by 2050 by supporting renewable energy and reducing the amount of nuclear power the country uses. It also establishes a tax on carbon dioxide emissions on transportation and heating fuels. The tax will start at seven euros ($9.56) per metric ton next year and rise to 22 euros ($30.06) per metric ton by 2016.
The government expects the tax to raise 340 million euros ($464.7 million) next and 4 billion euros ($5.47 billion) in 2016 which will be used to fund green energy development.
“Fossil and nuclear energy will thus be mobilised to allow us to meet our energy transition objectives,” said French Prime Minister Jean-Marc Ayrault last month.
However, the tax will really fall on households and small businesses as industrial companies — which already fall under the European Union’s cap-and-trade system — along with the transportation and fishing sectors will be exempted from the tax.
This comes after violent protests broke out in October and November regarding France’s planned “eco-tax” on heavy goods vehicles using French roads. The agrarian northwest region of the country which heavily relies on vehicle transportation protested the measure.
“Brittany is demanding the permanent suspension of the ecotax, especially since we don’t know how long this moratorium will last,” said Christian Troadec, the mayor of Carhaix and a key protest organizer.
The one billion euro ($1.38 billion) “eco-tax” plan was postponed by the government, but protests did little to curb their goals of tackling global warming.
French households already pay higher than average gas prices and relatively high prices for home heating oil, so the government is planning on increasing energy subsidies to encompass four million “fuel-poor” households to offset higher energy bills. This will cost 400 million euros ($546.7 million) next year.
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