In what must be a mixed blessing to German supporters of alternative fuels, the German government has reached an agreement to impose a 9 eurocents (about 11.4 U.S. cents) tax per litre of biodiesel. A 15 eurocents (19.1 cents) per litre tax will be imposed on blended fuels. Vegetable oil will continue to remain tax-free.
The agreement was reached after strong debate between the conservative and Social Democrat parties. Previously, biodiesel had been exempt from taxation. But with rising fuel prices, many Germans switched from regular diesel, which is a source of revenue for the government. Biodiesel consumption nearly doubled from 2004 to 2005.
[Source: Reuters via Planet Ark]