European court to rule on German fuel tax

21 November 2013

The Hamburg Tax Court will refer Germany's levy on nuclear fuel to the European Court of Justice (ECJ) to determine whether the tax conforms to European Union law.

The German court said that it was unable to "unequivocally" determine whether the tax was in accordance with European law and, if not, whether it should be revoked. The court will therefore ask the ECJ to assess whether the fuel levy meets EU regulations.

Since January 2011, each gram of fissile nuclear fuel loaded into a German reactor has carried a levy of €145 ($195). The tax is expected to bring in about €2.3 billion ($3.1 billion) in revenues annually. A complaint was lodged by utilities RWE and EOn with the Hamburg court over the fuel levy that it must pay for their jointly-owned Emsland nuclear power plant.

The tax courts in both Hamburg and Munich have expressed "serious doubts about the constitutionality of the nuclear fuel tax." In January, the Hamburg court said that it was "convinced" that the tax is "formally unconstitutional" and designed "to siphon off the profits of the nuclear power plant operators." It referred it to Germany's Constitutional Court, which has yet to rule on the issue. The tax court in Baden-Wurttemberg, however, has maintained that the levy is in accordance with both German and European laws.

Hamburg Tax Court president Christoph Schoenfeld said, "The thing we will ask the ECJ in particular is whether the European energy tax directive prohibits the levying of a tax on nuclear fuel used to generate electricity." He added, "There is also the question of whether the nuclear fuel tax is to be regarded as an indirect tax on electricity under European excise duty. The question is of importance because this directive prevents member states from inventing new electricity taxes to finance their general budget."

The court said that the decision made by the preliminary ruling of the ECJ will be final. However, it said that nuclear utilities will be required to continue paying the fuel tax until the preliminary ruling, expected in about 15 months.

Researched and written
by World Nuclear News