French biofuel tax revision threatens jobs -makers

Thousands of jobs could be lost in the French biofuel sector if the government’s proposal to scrap tax advantages for the grain-made fuels by 2012 is adopted, ethanol makers said on Tuesday.

The government said in its draft 2009 budget released on Friday that it would gradually phase out tax reductions given to ethanol and biodiesel from January, arguing higher oil and grain prices had removed the need for fiscal support.
“A vote for this proposal as it stands would rapidly lead to a collapse of the French bioethanol sector and the destruction of thousands of jobs,” the organisation of French ethanol producers SNPAA said in a statement.

The lobby said ending the tax reductions would open the door to cheaper Brazilian ethanol imports and threaten the domestic industry, which has invested nearly 1 billion euros to build new plants.

To reach its ambitious targets for blending biofuels with standard fuels — 7 percent of all fuels by 2010, and 10 percent by 2015 — France introduced quotas with reduced taxes in 2003 to make the products more competitive with standard fuels.

Guardian