AbstractAll countries in Europe have road fuel taxes and these account for roughly half of the net fuel price. We compare current road fuel taxes and corrective taxes, estimated on the basis of negative externalities from road transport for 22 European countries, taking into account the effect of fuel taxation on fuel efficiency. We focus on cars running on diesel or petrol and commercial vehicles running on diesel. If fuel taxes were intended to internalize all road transport externalities, then a number of countries could be considered to be on the right path already in what respects petrol taxation. Diesel, on the other hand, seems to be under-taxed in all 22 countries. Petrol tax increases would be in order in some countries and diesel tax increases would be in order in all 22 countries, at least as a bridge until fine-tuned policies, such as widespread peak congestion pricing or pay-as-you-drive insurance can be put in place.
HighlightsNegative externalities from road transport are estimated for 22 European countries, on the basis of a number of previous studies.Corrective petrol and diesel taxes are estimated for these countries, taking into account the effect of fuel taxation on fuel efficiency, and they are then compared with current taxes.Petrol is under-taxed in a number of countries.Diesel, especially that used by commercial vehicles, is under-taxed in all 22 countries.
Road fuel taxes in Europe: Do they internalize road transport externalities?
Transport Policy ; 53 ; 120-134
2016-09-28
15 pages
Article (Journal)
Electronic Resource
English
Road fuel taxes in Europe: Do they internalize road transport externalities?
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