Dramatic changes in the ways in which energy is taxed could be made by the European Union (EU), a new report suggests.

Reuters viewed an EU briefing document which suggested that tax changes will help “shift the tax burden” and improve the financial situation of struggling countries without increasing the levy on workers.

“Standard taxation rules discriminate against renewable energies,” the news agency quoted the document as saying, adding that the current system often favours big polluters.

Two forms of tax were covered under the proposals; a carbon tax and a levy placed on the energy content of a fuel rather than the volume.

Emer Traynor, a tax spokeswoman for the commission, told the news provider that she was unable to comment on the document itself, but explained that they were not talking about raising taxes but simply restructuring them.

She added that consumers would receive benefits by adopting more energy-efficient lifestyles.

The news is the second significant piece of information regarding EU climate change policy to come out in as many weeks.

Climate commissioner Connie Hedegaard and energy and climate change secretary Chris Huhne both came out in favour of upping carbon reduction targets from 20 per cent by 2020 to 30 per cent.