16 January 2006 - The UK could be breaking EU law by taxing vegetable oil sold as car fuel, according to Green MEP Caroline Lucas.

A 2003 EU Directive requires all EU members to promote the use of biodiesel and other fuels from renewable sources as alternatives to petrol. The government, stating that reducing fuel duty was its primary means of promoting biofuels, exempted vegetable oil from 20p a litre tax to encourage its sale.

But customs officials have reclassified some vegetable oils as ‘fuel substitutes’ rather than ‘biodiesel’, and re-imposed the tax and demanded a full rebate from the EU of all tax it has forgone during the last three years.

Dr Lucas, who represents the South-East and is a member of the European Parliament’s influential Environment Committee, said the UK government’s stance revealed the widening gap between its rhetoric and action on tackling climate change.

“In public, the government has said it supports greater use of renewable alternatives to petrol – but its taxation policies show the exact opposite is in fact the case,” she said.

“Tony Blair has repeatedly told us that tackling climate change is his biggest priority, but his government doesn’t seem to be taking the same view.

“It’s really very simple: the UK must do everything it can to encourage a reduction in demand for fossil fuels, and stop trying to cover up its failures by picking fights with the EU over how to implement the very laws which are designed to help it do so.”

Environmental campaigners have in the past called for restrictions on importing biodiesel produced from oil farm plantations at the expense of rainforest – but EU-grown rapeseed oil does not do this.

Dr Lucas has submitted a parliamentary written question asking the EU to clarify the status of vegetable-based bio-diesel and rule on the legality of the UK’s tax regime accordingly.

ENDS