Switzerland removes taxes from revised CO2 law proposal

Funds will be made available to renovate buildings and replace inefficient heating systems. Keystone / Peter Klaunzer

The Swiss government has presented new plans to slash CO2 emissions with a changed focus on economic incentives, rather than fossil fuel taxes.

In June, voters rejected a previous CO2 law that envisioned a series of penalties against airlines, drivers and owners of buildings that emitted high levels of greenhouse gases.

“The new template is based on supplementing the existing CO2 tax with effective incentives as well as targeted funding and investments and supporting ongoing developments,” read a government statementExternal link on Friday. “The focus is on measures that enable the population to reduce CO2 emissions in everyday life.”

The aim is still to halve Switzerland’s greenhouse gas emissions by 2030 compared to 1990 levels.

Funding

The government is now promising some CHF2.9 billion ($3.1 billion) to help finance the renovation of buildings and to replace inefficient heating systems. Part of this sum will be funded by an existing CO2 tax.

The new law would lower the CO2 limit for vehicles and penalise car importers if they fail to reach the new targets. This would help fund a CHF210 million project to install more electric car power charging points.

Public transport tax breaks would be eliminated for diesel powered vehicles, with the consequent extra tax being funneled into producing more electric and hydrogen powered replacements and supporting more long distance and night trains.

Airlines

Airlines will face an obligation to use more renewable fuels, while the government pledges some CHF25-30 million per year to supporting producers of synthetic aviation fuel.

Petrol and Diesel importers would also be obliged to replace some of their fossil fuels with renewable alternatives.

Companies would be exempt from CO2 taxes if they can prove they are acting to reduce their fuel and gas emissions.

The proposed new law will be put out for consultation until April of next year before being submitted to parliament.