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Growing Number of EU Countries Levying CO2 Taxes on Cars and Incentivizing Plug-ins

21 April 2010

Aceaco2
EU countries with CO2-based taxation policies by year since 2006. Data: ACEA. Click to enlarge.

At present, 17 of the 27 EU Member States levy CO2-related taxes on passenger cars, and 15 governments provide tax incentives for electrically chargeable vehicles, according to the newly published European Automobile Manufacturers’ Association (ACEA) Tax Guide 2010. In 2009, motor vehicle taxes in the EU 15 amounted to €377 billion (US$505 billion) or 3.4% of GDP.

The seventeen EU countries that levy passenger car taxes partially or totally based on the car’s carbon dioxide emissions and/or fuel consumption are: Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Ireland, Latvia, Luxembourg, Malta, the Netherlands, Portugal, Romania, Spain, Sweden and the United Kingdom.

By April last year, sixteen Member States had CO2-related taxation, up from fourteen in 2008, eleven in 2007 and nine in 2006. New to the list are Germany, that introduced such system in the summer of 2009, and Latvia. Italy chose not to prolong its one-year fleet renewal scheme which included both CO2-based incentives and incentives for electric vehicles.

Incentives for electrically chargeable vehicles are now applied in all western European countries with the exceptions of Italy and Luxembourg. New to the list is Belgium. The Czech Republic and Romania take the number of Member States up to fifteen. The incentives mainly consist of tax reductions and exemptions, as well as of bonus payments for the buyers of electric vehicles.

ACEA says that the European car industry supports the further introduction of the fiscal incentives for fuel efficiency. Tax measures are an important tool in shaping consumer demand towards fuel-efficient cars, and help create a market for breakthrough technologies, notably during the introduction phase. Innovations generally first enter the market in low volumes and at a significant cost premium, and this needs to be offset by a positive policy framework.

ACEA says that the failure to harmonize tax systems weakens the environmental benefits that CO2-based taxation and incentives can bring. European automakers have long called for the abolition of car registration taxes which are still widely applied in the EU. Generally, registration taxes threaten fleet renewal. A harmonized CO2-based tax regime for cars should be a priority, the association says, applying a linear, technology-neutral system that is budget-neutral in end-effect. It would maximize emission reductions, support manufacturers and maintain the integrity of the single market.

In 2009, the market share of cars emitting 120 gCO2/km had risen to 25%. Cars with emission above 160 gCO2/km accounted for 23% of the market, compared to 39% in 2006 and to 80% in 1995.

The annual ACEA Tax Guide gives an overview of motor vehicle taxation in the twenty-seven Member States of the European Union, the countries of the European Free Trade Association as well as Turkey and, for the first time, Brazil China, India, Japan, Korea, Russia and the United States.

The Tax Guide is compiled with the help of the national associations of motor vehicle manufacturers or importers and describes in detail the taxes that are levied on the sale, registration, ownership and the use of motor vehicles in each country.

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April 21, 2010 in Climate Change, Emissions, Europe, Plug-ins, Policy | Permalink | Comments (22) | TrackBack (0)

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Everybody knows that the solutions to Global Warming® (since rebranded Climate Change®, since rebranded CO2 Pollution®) are drastically higher taxes, massive losses of freedom, and an ever expanding, incompetent, government. Way to go EU! Send your jobs to China and India! We all know that Greece is the best example to follow when it comes to government spending/taxation and you are doing a fantastic job of emulating Greece. Of course so are California, New York, and The U.S. in general - bankruptcy is the way!

There is no tax increase, only a change in taxes.
What is driving bankruptcy is a negative trade balanse due to imported fossil fuels.

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What is driving bankruptcy is a negative trade balanse due to imported fossil fuels

No, what is driving bankruptcy is government spending, and future promises of spending, increasing at rates higher than taxation can afford to support. The U.S. national debt (including future promises of Medicare and Social Security) is not payable (drastic inflation to devalue said debt coming soon!).

The price of, and purchase of, oil has very little to do with government spending when the total spending picture is analyzed. Government transfers of wealth (simply take from one and give to another - government employees taking a cut, of course) are 70%, plus, of U.S. government spending.

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These taxes can be constructive. They resemble the gas guzzler tax in the US of a few years ago, although more sophisticated, since they are scaled. At the end of the day, its a tax on fuel consumption-more fuel burned equals more carbon.
Just returned from Europe and saw UK TV coverage as their sticker tax kicked in. Its about $1500 to $3000 on a vehicle the size of an Audi A6.

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At the end of the day, its a tax on fuel consumption-more fuel burned equals more carbon.

We already have that in the U.S. It's called the federal and state gas (and diesel) tax. Of which the government makes more money per gallon of fuel than oil companies make in profit. The worse mileage, the more fuel, the more CO2, the more taxes paid. It's not complicated or "sophisticated."

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EU has applied very effective ways to reduce liquid fuel consumption and associated pollution while actively promoting the transition to electrified vehicles. The rest of the world will soon follow. It is common sense and it will prevail. No public taxes should have to be used.

EU and USA (and others) must also apply effective measures to fight financial-banking-insurance-speculators corruption to avoid another worldwide financial crisis and government hand outs. An anti-corruption fund of a few trillion $$ would be required. Such fund should be paid by all those who created the last financial crisis. A financial transaction fee of 1/4% to 3/4% should be enough. No public taxes should be used.

Anther anti-corruption or mismanagement fund could be created to bail out large corporations (like GM) that are too big to fail and had to be saved with government hand outs. That fund should also be 100% financed by the firms concerned. No with public taxes have to be used.

With the above three (tax free) measures, public taxes could be reduced by up to 30% and more and The Goracle would be happy..

While this and other sites report global temperature readings and trends..
http://www.greencarcongress.com/2010/04/rogelj-20100421.html#more
http://www.greencarcongress.com/2010/04/noaa-20100415.html

Hottest March on Record.. at least the Goracle can be counted on to reassure us that the status quo works.

Goracle can be counted to spew forth complete garbage as usual. That's his entire raison d'etre.

Society works if goals are put forth and frameworks are developed. Only complete naivete would allow someone to believe that out of no rules are needed to optimize outcomes.

The Goracle is the Kent Hovind of the climate debate.

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Ahhhh.... Name calling and slander from the Globalwarmists once again! "Science!"

Praise be to Algore!!!

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Goracle,
Have you noticed that we spend between $500B and $900B a year on foreign oil in the US (depending on the price of oil that year and our economic strength)... and that is simply money leaving our economy. Spend that amount for about 10 years and see what that does to your national debt.

Have you ever checked actual data to see when this debt was piled up and what it was being spent on?

You claim it's because of big government and government transfer of funds. Here is a chart of the actual time this debt was piled up. Notice that the trend always goes UP during the times of those heros of small "government" Reagan, Bush Sr. and ESPECIALLY Bush Jr. Notice the trend line from 1992-2000 when Clinton was in office and everyone was screaming about "big government".

http://www.usgovernmentspending.com/downchart_gs.php?year=1950_2010&view=1&expand=&units=b&fy=fy11&chart=G0-fed&bar=0&stack=1&size=l&title=US%20Federal%20Deficit%20As%20Percent%20Of%20GDP&state=US&color=c&local=s

It seems to me that a much more likely cuplrit is military spending which trends much more closely with the growth of the US national debt. Hey I'm all for a strong military, but we spend way too much on it because we're trying to protect oil access and control the middle east.

DaveD: Great link.

A little math I've been thinking about: A barrel of petroleum produces something like 45 gal of refined products. If that barrel costs $90 on the international markets (to make the math easy), then there's $2 worth of unrefined petroleum in each gallon. We import about 2/3 of our petroleum, so...

For each gallon of gas you buy, you are sending about $1.33 out of the country. About half of that goes to OPEC. Mmmmm, feels good doesn't it.

Support al-qaida; buy more gas. (I'm thinking of having some bumber stickers made up).

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And the fantastic thing is that my car gets 50mpg highway (better than most evil, gas using hybrids!) without using that EVIL oil!!! Many of the hypocrites on this board can't say that!

Regarding the Constitutional mandate for defense, the war to stop the slaughter of millions of people (I know, I know... many object to it because those people "don't look like us") did add maybe 5% to the national debt for the duration of the war. Last time I checked, 5% is nothing like the 70% that is purely wealth transfers from one set of people to another, politically favored set. When the math by some is this bad one can see whey Globalwarmists believe that the "science" of Climate Change is "settled."

Finally, the trade deficit has little to do with the national debt. (Aren't these concepts hard!?!?!)

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Shifting taxes to carbon emissions makes complete sense, and will strengthen countries who are suffering from high oil import trade imbalances. Trade accords will be struck to ensure that any country who wants to do business with us will have an acceptable (and verifiable) carbon emissions reduction action plan.

Oh, and Goracle, the global land/ocean temperature for March was higher than any other March on record.

http://www.ncdc.noaa.gov/sotc/?report=global&year=2010&month=3&submitted=Get+Report

"The combined global land and ocean average surface temperature for March 2010 was the warmest on record at 13.5°C (56.3°F), which is 0.77°C (1.39°F) above the 20th century average of 12.7°C (54.9°F). This was also the 34th consecutive March with global land and ocean temperatures above the 20th century average."

Even Spencer had to tweak his satellite data to keep Jan and Feb from being too high above average temperatures.

http://www.drroyspencer.com/2010/03/february-2010-uah-global-temperature-update-version-5-3-unveiled/

The relatively short cool dip in 2008 is gone, and the long term strong interdecadal warming trend continues.

The above article is talking about annual Vehicle Excise Taxes rather than fuel taxes per se, where countries are adding (rather than shifting to) a system where vehicles pay an annual fee depending on their CO2 consumption. In the UK if your car generates 200g/km of CO2 (or in layman's terms does less than 30mpg)it gets slapped with a £400 per year fee, which will no doubt rise above inflation. This does not include the showroom tax which is applied when buying the car new.

I'm not against the showroom tax - the theory being that if your flush enough to afford a new car then you can afford the tax as well, especially if its a big emitter. In time this will change the vehicle parc to a more efficient fleet.

What I am against is the annual fee. It fails to discriminate between the owner of a V8 classic sports car that may get an occasional blast for a few miles on weekends, and say a Prius which is driven for miles everyday commuting.

Aside from that in European countries, especially the UK, we already have eye watering levels of fuel tax which makes driving even the most efficient cars very expensive (much more than it costs to drive an SUV in the US on a cents per mile basis), so this makes any further tax burdens very heavy handed.

Ahhhh.... Name calling and slander from the Globalwarmists once again!

Oh the irony of that statement coming from a guy who signs off with "Praise be to Algore!!!"

Face it dude, you've done worst.

Scott:

Yearly registration fees based on CO2/Km x Km per year (or 15 000 Km if no records are kept), could produce enough revenues to lower fuel taxes. However, plain fuel taxes are much easier to collect and are more closely related to the volume used.

One way to promote and accelerate the transition to electrified vehicles is with higher fuel taxes (and/or selective registration fees) and higher incentives towards the purchase of e-vehicles. You may call it acceptable positive discrimination. Nothing wrong with it when used for the well being of the nation.

HarveyD:

That was my point - fuel taxes are more appropriate than annual vehicle exise duties and they are easier to collect at the point of sale as you suggest.

The problem with fuel taxes is that they are already too high - beyond the point where they easily influence people in choosing a car based on its efficiency. I'm talking about UK fuel prices where 65-70% of the price paid is tax and therefore stand at around £1.20 per litre for unleaded ($6.85 per US gallon equivalent) and £1.21 per litre ($6.90 per US gallon equivalent) for diesel, which I'm sure would make even the most 'green' motorist cringe at the forecourt. It has a regressive disporortionate impact on people on low incomes and people who live in rural areas who need to rely on private transport to get to work and have access to local services and facilities.

Annual vehicle taxes based on CO2 emission is not an alternative when fuel prices do more than influence buying decisions. It is not viewed in the UK as a means of lowering fuel taxes. It simply adds to the tax burnen on the motorist. This is heavy handed approch.

I doubt such high levels of tax will enourage a switch to electic vehicles either, because of 1) the high capital costs of buying an electric vehicle which people on low incomes cannot afford (forcing them deeper into a fuel poverty trap) and 2) because of the current limitations in terms of range that electric vehicles offer, so this means that practicality will rule over running costs until technology improves.

In the meantime a drive towards sustainable biofuels makes more sense in reducing CO2 emissions - fuels that can be used in vehicles new and old - less capital and energy and resource intensive than the need to replace the current fleet prematurely and providing the infrastructure for charging etc.

EVs in the short terms only have the potential for making short journeys in urban areas less carbon intensive (assuming of course that the electicity comes from renewable sources - which most of it doesn't). But then these are the sort of journeys where alternatives (walking, taking the bus and so on) already exist.

Scott wrote;

"It has a regressive disporortionate impact on people on low incomes and people who live in rural areas who need to rely on private transport to get to work and have access to local services and facilities."

Persons with low incomes normally live in an area that has mass transit of one form or another; biking is also an very low cost option. Affording a vehicle should not be considered a right.

People who live in rural areas and commute to cities have chosen to have a high carbon footprint. They should either pay a premium for increasing sprawl or move closer in. Rural areas should be for food production.

Will

There are a lot of people in 'real' rural communities that have low incomes. Its not just a rich persons playground as you assume.

Planning laws are strict in the UK preventing urban sprawl. Some may choose to live and commute in but then the reverse is true where limited housing, may force people to live in cities and commute out to low paid jobs.

I think you need to think more about this.

Harvey D,

I just ask where the indictments are? The first three companies to go bankrupt on Wall Street, precipitating the financial meltdown and recession, and producers of lots of derivative waste paper, have had all their CEO looters escape, without even a wrist slap.

Where are they now? Hiding out in the White House as Financial Advisors, after paying a a petty minimum of a million dollars of the ill-gotten gains, by each in campaign contribution "Protection Money". Franklin Reines CEO and looter of Fanny Mae, Jim "Tim" Johnson CEO and looter of Freddie Mac and Jamie Gorelik, CEO and looter of EF Hutton, are all safely there beyond reach. All are counting the 100s of $ millions of remaining ill-gotten gains.

I'm sure they are advising the Clueless One on how to correctly "regulate" Wall Street ethics...

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