German Court Deems Nuclear Fuel Tax “Unconstitutional”

A German tax court on Tuesday ruled that the country’s excise tax on nuclear fuel levied since January 2011 is unconstitutional and lacks legal competence. The matter now proceeds to the Federal Constitutional Court, which alone has the jurisdiction to rule on the invalidity of the law.

Introduced as part of a deal in late 2010 by the federal Legislature in return for life-extensions of nuclear power plants in Germany, the nuclear fuel tax is triggered when a nuclear reactor is equipped with a fuel element and a self-sustaining chain reaction is initiated. The amount of tax depends on the nuclear fuel used, but it carries a levy of €145 ($196) per gram of nuclear fuel (U-233, U-235, and Plu-239, and Plu-241) used for the commercial generation of electricity.

After the Fukushima disaster in March 2011, however, when Germany endorsed a plan to shut down all 17 of the country’s nuclear plants by 2022, it revoked the plants’ lifetime extensions, but not the nuclear fuel tax.

The nation’s three nuclear plant–owning utilities—E.ON, RWE, and EnBW—thereafter initiated court action, arguing the tax was unlawful. The local finance courts in Hamburg and Munich agreed, and granted provisional legal protection from the tax, but the German Federal Court of Finance overruled that decision in March 2012.

On Tuesday, the Hamburg Tax Court (Finanzgericht Hamburg) called the tax "formally unconstitutional." It noted that when the fuel tax was introduced, an annual revenue of €2.3 billion was expected, but to date, nuclear generators have paid €1.5 billion ($2 billion).

Sources: POWERnews, Hamburg Tax Court

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