In the transition to a transport industry with less emissions, gas as an alternative drive source has been an important part for us at Tempcon and many others in the industry. Through the gas, we have been able to quickly reduce our emissions and move towards the 2030 goal of a sharp reduction in emissions. A new EU judgment which this week won legal force now throws us several years back in development as the tax exemption for biogas is abolished.
The verdict means that Swedish biogas companies will have to pay millions in higher taxes. Something that will affect Swedish hauliers with greatly increased costs, which will hit an already tough industry. Many talk about increases of up to SEK 10 per mile or more.
The reason is the German company Landwärme, which believes that the aid in the form of tax exemption is an overcompensation that leads to a distortion of the market and affects competition. Landwärme therefore appealed the decision and the European Court of Justice ruled in Landwärme’s favor.
The European Commission wanted Landwärme’s action to be dismissed. The Swedish government also intervened. But when the verdict was handed down on December 21 last year, the court ruled the company right in that it considered that the European Commission had not investigated the consequences of the aid carefully enough. The Commission should have started a so-called review procedure, a kind of referral round, in order to make the decision. The government interprets the judgment as a procedural criticism rather than a criticism of the tax exemption itself. However, the government chose not to appeal the verdict – which was met with strong criticism, including from Transportföretagen.
– An appeal by either the EU Commission or Sweden would have given us an extended time, then we could have worked on this in-depth review in the meantime, believes Susanne Karlsson, deputy head of social policy at Transportföretagen.
Foed Meliane, CEO of Tempcon’s subsidiary Widriksson Logistik, believes that this will have fatal consequences for many haulage companies.
– If you look at the situation we are in now; an inflation rate of 10 percent, salary increases that we estimate will land at 4-5 percent, and now this biogas shock of 10 kroner more per mile, this is going to be incredibly heavy. I have never experienced anything like this in my 20 years in the business.
And as extra salt in the wounds, the Tax Agency is now looking at whether the companies that have received tax exemptions since 2020, when it was introduced, will possibly be liable to repay the support of three billion kroner that has been paid out.
– This is a historic situation, but we simply do not yet know how to do it, because we have never been involved in anything like this before, says Titti Campalto, acting head of unit at the excise unit at the Swedish Tax Agency. We are trying to understand whether the judgment means that the Swedish Tax Agency must reclaim the amounts paid out since 2020.
Instead of appealing the verdict and giving all involved parties a longer deadline, the government has sent a letter to the European Commission signed by Finance Minister Elisabeth Svantesson and Energy and Business Minister Ebba Busch to underline the importance of the support for the climate, industry and the energy transition. Svantesson says in a comment earlier this week that the government will
– work actively with the EU Commission to achieve continued tax exemption as quickly as possible with as much legal certainty for the industry’s actors as possible.
However, how long it may take is unclear.