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French opt for a carbon tax from 2010

- Monday, September 21, 2009

The French President, Nicolas Sarkozy, has announced that the French Government will impose a carbon tax from January 1st, 2010, with the rate initially set at 17 euros ( $A 28.80) per tonne of emissions. While the measure has still to be approved by the French Parliament, Sarkozy's large majority make passage of the measure fairly certain.

The Economist reports that the tax will be applied to petrol, gas and coal use, but not to electricity which in France is largely generated using nuclear power. The measure has significant exemptions, with heavy industry in particular not required to pay the tax due to the involvement of those businesses in the european ETS. Fishermen and farmers (who already pay a lower rate of fuel tax) will get special compensation.

As an indication of a related agenda, Mr Sarkozy has stated he will use the measure as part of a push for a Europe-wide carbon tax on imports from countries that 'do not respect any environmental or social rules."  
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