FIA calls upon ECOFIN to put CO2 car taxation on agenda
Publication date: 04 April 2007
“Linking taxation to CO2 is not only the best choice for the consumer but it is the best choice for the environment” says Wil Botman, Director General of the FIA European Bureau.
Following the publication of the Green Paper on market based instruments for environment related policy, the Fédération Internationale de l’Automobile (FIA) feels compelled to back the European Commission in its efforts to link car taxation to CO2 emissions.
In 2005 the FIA warmly welcomed the proposal by the European Commission to harmonise the various car taxation systems across Europe abolishing the registration tax and linking it to CO2 emissions. Further to this the FIA was pleased to note last year that the European Parliament voted in favour of the proposal.
Mobility, like many other sectors of our economy, uses energy through burning fossil fuels and emitting greenhouse gases such as CO2. Automotive transport has reduced its share of global CO2 emission to 11%. Much of this improvement has been achieved in Europe where high efficiency levels have been reached.
The FIA believes that further reducing the carbon footprint of cars has to be achieved through consumer oriented policies. While the FIA is already in the forefront of pushing for eco-labelling and eco-driving, further CO2 based incentives are needed.
Motorists currently face a high burden when it comes to taxation. Revenue from road transport taxation represents 15% of total government revue across Europe yet most of this money is not reinvested into road transport. Expecting to change mobility patterns by simply increasing taxes is not only unfair, but quite simply a bad policy.
Consumers adapt their mobility when given the right incentives. An increased burden on the car user is not a solution. The FIA believes that linking tax to CO2 emissions will reintroduce a level of equality to the current system, and further be consistent with EU policy of reducing CO2 emissions from cars to 130 g/km by 2012. A fair tax system that does not discriminate against road users and is integrated with environmental policy is the only progressive way to move forward.
The FIA is therefore disappointed to note that the ECOFIN Council has yet to put the issue on the agenda, yet was happy with the ECOFIN conclusion of 27 March encouraging member states to further coordinate their tax policies. The FIA hopes that this, along with the Green Paper on market based instruments for environment related policy, will pave the way towards a common policy for car taxation across Europe.
The FIA is fully aware of the problems of achieving unanimity in the Council on such sensitive issues such as taxation. Consequently the FIA would favour the use of reinforced cooperation so that at least some of Europe’s drivers can experience the benefits of integrated approach to car taxation.
Note to the Editors
The Fédération Internationale de l’Automobile, via its affiliated members, national motoring and touring organisations, is the leading consumer mobility organisation representing over 34 million members in Europe. Europe’s motoring and touring organisations have as one of their highest priorities the economic, social and environmental sustainability of mobility.
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co2_ecofin_042007.pdf (21 KB)
Response by the Fédération Internationale de l’Automobile to the European Commission’s proposal for a directive on passenger car related taxes (COM(2005) 261 final)