New French legislation on a carbon tax that was supposed to take effect on January 1st will come into force in July and will also apply to France's biggest polluters, senior government officials said today.
France's constitutional council ruled against an original version of a domestic carbon tax two days before it was meant to come into force on the grounds that it made too many exemptions.
President Nicolas Sarkozy's administration is rushing to draw up a revised text that it hopes will overcome the council's objections without putting domestic firms at a disadvantage to their international competitors.
A new law is due to be presented to the cabinet on January 20th, and government spokesman Luc Chatel said it should be approved by parliament over the following five months. "The new carbon tax will take effect on July 1st," he said.
France is the largest European economy to try to introduce a carbon tax, and Mr Sarkozy has said it is a crucial weapon in the fight against climate change. However, the opposition Socialists say the tax will unfairly penalise low earners and hit people living in areas with little or no public transport.
The new text will go to parliament at a time when parties are campaigning for regional elections in March, which is likely to further inflame debate.
Economy Minister Christine Lagarde told Les Echos newspaper today the new legislation was likely to propose that more than 1,000 of the heaviest polluters in France face varying penalties that should not harm their competitiveness.
In the original version, these firms were exempted because they were already subjected to a European Union emissions trading scheme.
The degree to which they fork out for the carbon tax will depend on the intensity at which they used energy and the extent to which their sectors faced competition, Ms Lagarde said.
"We are working on the possibility of applying reduced rates and of putting in place other incentive mechanisms or platforms," she told the paper. "The competitiveness of companies is important and there is no question of taxing all these sectors indiscriminately including those that are economically fragile," she added.
In a separate interview on France 2 television, she said the new law would not include profound changes.
Reuters