Mineral Oil Tax Exemption for Biofuels

Source: JOIN IEA/IRENA Policy and Measures Database
Last updated: 3 February 2016

The mineral tax exemption for biofuels entered into force on 1 July 2008. This exempts fuels produced from renewable feedstock from the mineral oil tax, provided that they prove they have a positive aggregate environmental impact and are produced under socially acceptable conditions. An application form is to be filled out by the producer or importer of the fuel and handed in the Directorate General of Customs (DGC). The application form contains questions regarding the ecological and social minimum requirements. The DGC decides whether the minimum criteria are met and whether tax exemption is justified. There are three ecological minimum requirements that must be met in order to qualify for tax exemption: 

  1. biofuels must generate at least 40% less greenhouse gas emissions compared to the life cycle emissions of fossil fuel; 
  2. biofuels must not harm the environment significantly more (from cultivation of raw materials till end use) than fossil fuel and; 
  3. the cultivation of raw materials must no endanger tropical forest preservation and biological diversity. The cultivation of raw materials and the production of biofuel must respect the social regulations applicable in the production country. However, the ILO (International Labour Organization) fundamental conventions must always be respected.

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