Billions of Euros lost due to car tax CO2 ratings
The Greens/EFA group in the European Parliament released a study arguing that several EU states have lost billions of Euros in tax revenues due to incorrect classification of CO2 values of cars. The report underlines a gap of €10 billion in tax revenue between type-approval CO2 emissions and real-world emission values, as most of these countries use CO2-based car registration and ownership taxes.
The study, produced by Green Budget Europe, focuses on eleven EU countries (Austria, Belgium, Denmark, Finland, France, Germany, Luxembourg, the Netherlands, Spain, Sweden and the United Kingdom) which represent 60% of the total car registrations in the EU. According to its results, these states faced a theoretical €10 billion revenue loss in 2016 that would have been recovered if CO2 emission values had been more realistic. Over the period 2010-2016, the potential loss is between €40 and €50 billion.
The report developed upon arguments raised in the ICCT briefing regarding the Commission’s proposal for Post-2020 CO2 standards, indicating a 42% gap between type-approval and real-world CO2 emissions values in 2016.
Although the authors welcome the introduction of the Worldwide Harmonized Light Vehicle Test Procedure (WLTP) that will reduce the gap between type-approval and real-world emission values, they consider that this gap will remain large and it will not resolve the fundamental problem of revenue losses for EU states. Greens/EFA tax justice spokesperson Sven Giegold, is calling EU institutions, national governments and authorities to take regulatory actions in order to base passenger car taxation on real-world CO2 emission values, as an “incentive to move towards cleaner forms of transport.”