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15 Jun 2020, 14:43
Benjamin Wehrmann

Vehicle tax for high-emission cars to rise in Germany by 2021

Clean Energy Wire

Newly registered cars in Germany with high CO2 emissions will be charged an increased tax by 2021 in order to "align the vehicle tax more with the pollutant emissions," the government said in a press release. The cabinet greenlighted the "climate component" in vehicle taxation, which will apply to cars with CO2 outputs above 95 grams per kilometre, as part of its 2030 Climate Programme. The tax will be raised to two to four euros per gramme/kilometre, gradually and depending on the vehicle’s carbon output. "The aim is to reduce CO2 emissions in the transport sector by 40 to 42 percent. At the same time, it's important to consider social aspects, to safeguard the industry's competitiveness and guarantee affordable mobility," the government said. However, owners of entirely electric vehicles will benefit from tax exemption, with the government arguing this will facilitate its goal of having up to ten million e-cars on the road by the end of this decade.

Environmental NGO Greenpeace argued that the cost increase for heavy and fuel-intensive vehicles will only be "minimal," pointing out that a typical SUV will be taxed about 180 euros more per year. "With this flabby reform the government will get nobody to switch from a gas-guzzling car to a modern and environmentally friendly one," said Greenpeace's Tobias Austrup, calling on Germany's parliament to amend the policy and opt for a registration tax for heavy vehicles already introduced in other countries such as Denmark.

Greenhouse gas emissions and other detrimental side effects from heavy personal vehicles such as SUVs have been a heatedly debated topic in Germany for years, especially as the transport sector has struggled for decades to make a significant contribution to climate action. However, despite the sector's poor reduction record and strong financial incentives granted for e-cars, 35 percent of respondents in a recent survey said they would buy a diesel or petrol car, whereas only 21 percent said they would opt for an electric model.

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