Growing concerns over fuel taxation
As the WTO fisheries subsidy negotiations enter their final stages and after two decades of wrangling, trade ministers from 164 countries are determined to reach a deal ahead of the ministerial conference on July 15 this year.
The European fishing industry represented by EuropÃªche fully supports the need to reduce harmful subsidies on a global scale, like what was done in the EU in the early 2000s. In this context, the fisheries sector calls on EU institutions and Member States to defend the public aid system established under EU law, including the new Maritime and Fisheries Fund (EMFF). Likewise, the sector urges the EU not to give in to external pressure and to defend fuel tax relief regimes. The opposite will lead the fleet to ruin.
As part of the United Nations Sustainable Development Goals (SDGs), the World Trade Organization (WTO) has been given the mandate to regulate and discipline global fisheries subsidies. The main objective is to eliminate IUU subsidies and to prohibit certain forms of fishing subsidies that contribute to overcapacity and overfishing. The EU has one of the most advanced, innovative and transparent financing systems that contribute to the sustainable use and management of marine resources. Yet the EU’s fuel tax relief regimes are in the spotlight as some parts of the WTO see them as damaging subsidies.
According to EuropÃªche, fuels supplied for navigation, fishing and aviation purposes have historically been exempt from taxation to ensure conditions of international competition and cannot be considered as subsidies.
EuropÃªche argues that in an attempt to justify the removal of fuel tax breaks, some countries and civil society groups claim that these regimes have contributed to overcapacity and overfishing. The industry argues that this is far from the truth, especially in the case of the EU.
âUnlike other countries in the world which have grown their fishing fleets exponentially, the EU fleet has been reduced by 22,000 fishing vessels over the past 20 years. In addition, despite tax exemptions, fuel consumption and CO2 emissions from fishing have fallen by 18% in just ten years, âsaid Daniel Voces, CEO of EuropÃªche.
âWith regard to the allegations of overfishing, fish stocks have increased significantly, reaching levels in the North-East Atlantic 50% higher than in 2010. In addition, 99% of landings of regulated stocks by the EU come from sustainable fish populations. “
EuropÃªche states that fuel costs can exceed 40% of total operational costs for fishing companies and that, therefore, its taxation would put the EU industry at a competitive disadvantage compared to other countries where prices fuel and taxes are lower. It would also lead to a huge increase in fish prices, making seafood unaffordable for many end consumers.
Moreover, at present it is almost impossible in the WTO context to control or apply unfair subsidies to foreign fishing companies given the lack of data and transparency in many countries. In addition, developing countries may be exempt from fuel taxation.
âTaxing fuel for fishing would bring few ecological benefits while resulting in unprecedented large-scale bankruptcy for many fishing companies doomed to disappear. Family businesses would not be able to meet the expenses caused by rising fuel costs which in some cases could double the current price of fuel for fishing vessels, âsaid Daniel Voces.
EuropÃªche calls on the EU to defend fuel tax relief regimes for all European vessels, regardless of their size, flag or the fishing zone in which they operate.
“No one should be discriminated against or left behind,” he concluded.