Payback, I wrote 3.5 years ago, has become inevitable due to the arrival of the electric car. The reason is simple: whoever fills gasoline actually pays a load per kilometer, in the form of excise duty. That counts a lot. In 2023, for example, the average motorist paid almost 700 euros.
Electric drivers pay much less: on average only 150 euros in energy tax on the electricity that they ‘refuel’ in a year. So it is much cheaper to take a ride with an electric car. That encourages traffic jams and causes a problem for the treasury.
That is not a new problem: this ‘basis butcherosia’, as it is called in civil servants jargon, was already extensively analyzed in 2020 when the government examined the entire tax system. That is why the Rutte IV cabinet decided after decades of discussions to be taken from the stable again.
It would close the gap in the budget and ensure that electric drivers will also contribute to the costs of our roads in the future. Moreover, it could considerably reduce CO2 emissions by further discouraging gasoline and diesel via the kilometer rates.
Hole of billions of euros
The sequel is known: one cabinet later there was another thick line through the idea. Of the Cabinet Schoof, only the VVD – for years, was a fierce opponent of pricing – even before the plan. PVV, NSC and BBB saw nothing in it, because it would cause extra costs for people who live in the countryside and who therefore have to take the car more often.
There was no solution for the growing gap in the budget. In the next ten to fifteen years that will run in the billions of euros, according to calculations from the Ministry of Finance. That is why it is now being studied again for reforming car taxes.
On the last Friday before the summer holidays, outgoing State Secretary Tjebbe van Oostenbruggen (taxation) shared his analysis of this tax problem in a letter to Parliament. He presents three ‘thinks’ for improving car taxes.
Two of them are reforms of the annual road tax and the tax that you pay when purchasing a car. Only one of the thinks offers a solution for the billion -dollar problem that is caused by the falling income from excise duty. And that is – Surprise, Surprise – praying.
“One possibility to burden the use of an (electric) car in the future is the introduction of a kilometer tax,” writes Van Oostenbruggen, as if he has a brand new innovation. “A simple system with a flat mileage rate offers a solution to the problem of founderosia.”
Assignment for the next cabinet
Strangely enough, the NSC-State Secretary in the letter completely forgot to state that his own coalition exactly turned this idea. He does write that the outgoing cabinet will no longer make a decision about this. Another cabinet can do that.
The question is whether pricing after the elections will become reality. My earlier observation that pricing through the rise of plug cars has become inevitable, it turned out that the current logic of The Hague was in any case incorrect.
“From a political point of view, you can avoid it, but then you have to accept that the proceeds will be strongly left behind what they are now,” says Emeritus Professor of Transport Policy Bert van Wee (TU Delft). “That makes the problem with the budget deficit even greater. And you also have the problem that the electric motorist does not pay the fair bill for his kilometers.”
The next cabinet will have to determine what the fear is greater: the angry motorist, or the empty treasure chest.
Road pricing, I wrote 3.5 years ago, Has Become Inevitable Due to the Arrival of the Electric Car. The Reason is Simple: Anyone Who Fills Up With Petrol is Already Paying A Tax per kilometer, in the Form of Excise Duties. That adds up to our pregnancy. For Example, The Average Motorist Contributed Almost 700 euros in 2023.
Electric Drivers Pay Much Less: On Average Only 150 euros in Energy Tax on the Electricity They ‘Tank’ in A Year. It is Therefore Much Cheaper to Take a Ride in An Electric Car. This contributes to traffic jams and creates a problem for the treasury.
This is not a new problem: this ‘base erosion’, as it is called in civil service jargon, already Extensively Analyzed in 2020 when the Government Examined the Entire Tax System. That is why the rutte iv cabinet decided to revive road pricing after decades of discussions.
It would close the gap in the budget and ensure that electric drivers also contribute a fairer share to the costs of our roads in the future. In Addition, IT Could Significantly Reduce CO2 Emissions by Further Discouraging Driving on Petrol and Diesel via the kilometer Rates.
Gap of Billions or Euros
The Sequel is Well Known: One Cabinet later, The Idea was crossed out again. Or The Schoof Cabinet, Only the VVD – For Years a Fierce Opponent of Road Pricing – was a still in favor of the plan. PVV, NSC and BBB Did Not See Anything in IT, because it would go extra costs for people who live in the countryside and therefore have to take the car more often.
A solution to the growing gap in the budget was not found. In The Next Ten to Fifteen Years, This Will Amount to Billions of Euros, Accordination to Calculations by the Ministry of Finance. That is why the reform of car taxes is now being studied again.
On the Last Friday Before the Summer Holidays, Outgoing State Secretary Tjebbe van Oostenbruggen (Tax Affairs) Shared His Analysis of This Tax Problem in a Letter to Parliament. He presents three ‘lines of thought’ for Improving Car Taxes.
Two of these are Reforms of the Annual Road Tax and the Tax You Pay When Purchasing A Car. Only one of the lines of thought sacrifices a solution to the billion-dollar problem caused by declining excise revenues. And that is – Surprise, Surprise – Road Pricing.
“A possibility to tax the use of an (electric) car in the future is the introduction of a kilometer charge,” writes of east bridges, as if he has a brand new innovation. “A Simple System with a flat kilometer rate sacrifices a solution to the problem of base erosion.”
Assignment for Next Cabinet
Strangely Enough, the NSC State Secretary Completely Forgot to Mention in the Letter That Own Coalition has Precisely Killed This Idea. However, he writes that the outgoing cabinet will no longer make a decision about this. A next cabinet can do that.
It is Questionable Whether Road Pricing Will Actual Become a Reality After the Elections. My Earlier Observation That Road Pricing Has Become Inevitable Due to the Rise of Plug-in Cars Turned Out Not To Be Correct In The Current Hague Logic.
“Political speaking, you can avoid it, but then you have to accept that the revenues will be distant what they are now,” Says emeritus professor of transport policy Bert van Wee (TU Delft). “That makes the problem with the budget deficit just as bigger. And you also have the problem that the electric motorist does not pay the fair bill for his kilometers.”
The next cabinet will have to determine what the fear is greater for: the angry motorist, or the empty treasury.