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November 30, 2016

Volume 17 Issue 52

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UEIL Helps Defeat Excise Tax Proposal

The Union of the European Lubricant Industry recently helped defeat a proposal to bring bulk lubricants under the European Union’s Excise Movement and Control System.

A UEIL staff member said the outcome helped lubricant companies avoid significant new administrative expenses, but he warned that the proposal will likely arise again in the future.

“This idea, in one form or another, has already come before the [European] Commission multiple times, and that will probably happen again at some point,” Gregoire Poisson, a lawyer with the UEIL Secretariat, said at the association’s Annual Congress in Berlin Nov. 3. “It’s an issue that we will need to monitor and be vigilant against.”

Like many products, lubricants are already subject to excise taxes, but they are not among the energy products that – along with tobacco and alcohol – fall under the Excise Movement and Control System, a program designed to prevent avoidance of tax payment. The EMCS allows governments to track the movement of goods sold across national borders within the EU to ensure that the excise tax is paid when the goods reach their destination.

In September the European Commission published a proposal, initiated by Italy and other countries in Central Europe, to add bulk lubricants to the EMCS regime. UEIL representatives contacted representatives of the EU and nine member nations to lobby against the proposal and enlisted industry organizations and companies to do likewise. Poisson said their efforts helped convince four of the EU’s member nations to oppose the proposal, the third time it has secured a blocking minority on the issue.

UEIL has previously stated that even small lubricant suppliers would have to hire additional staff to do the work required if bulk lubes were brought under the Excise Movement and Control System.