- The Clean Industrial Deal (CID), focusing on clean technology production and the green transition of European industry, has been published on 26 February 2025 and is an integral part of the EU’s Competitiveness Compass, bringing together climate action and competitiveness under one overarching growth strategy. It aims to accelerate both decarbonisation and reindustrialisation across Europe by promoting climate-neutral investments in energy-intensive industries and clean technologies.
- The CID is a key pillar in achieving the EU’s net-zero sustainability goals by 2050, with a new intermediate target to reduce emissions by 90% by 2040. The CID’s focus areas include streamlining regulations and improving policy frameworks to drive innovation, create quality jobs, and strengthen Europe’s open strategic autonomy.
- On tax, the EC plans to issue, in second quarter of 2025, a recommendation to member states to adopt tax incentives to support the CID, with proposed measures including shorter depreciation periods for clean technology assets, tax incentives to offset high initial costs, and tax credits for businesses in strategic sectors.
- The CID also calls for member states to swiftly finalize negotiations on the Energy Taxation Directive to support electrification and discourage fossil fuel use. To aid energy-intensive industries investing in decarbonization, they should reduce electricity taxes and remove unrelated levies. In this regard, the EC will issue a recommendation on how to effectively lower taxation levels in a cost-effective way.
- Timing: the CID implementation will require the adoption of approximately 30 new pieces of legislation over the course of 2025 and 2026.
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