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MEPs Oppose German Road Toll

by Ulrika Lomas, Tax-News.com, Brussels

16 March 2017


Members of the European Parliament (MEPs) have said that Germany's planned road toll scheme for private cars would breach EU law by discriminating against foreign drivers.

The resolution, passed by 510 votes to 126 with 55 abstentions, criticized the scheme for allowing German drivers to deduct toll costs from their vehicle tax, while preventing foreign drivers from also doing so.

MEPs said that any national road charging system that directly discriminates based on nationality or when combined with national tax measures to the benefit of only nationals from a given member state, constitutes "a violation of the non-discriminatory principle enshrined in Article 18 of the Treaty of the Functioning of the European Union."

The proposals, originally adopted in 2015, were for the introduction of a vignette system from 2016 onwards, under which drivers would be required to purchase a sticker for either 10 days, two months, or one year. The tax was to be levied on all motorists, but German drivers would have the equivalent amount deducted from their vehicle tax liability, to ensure that owners of German-registered vehicles do not suffer any additional financial burden.

In June 2015, the European initiated formal infringement proceedings against Germany over the proposals. In December 2016, the Commission reached an agreement with the German Government that was intended to allow for a better differentiation of the road charge on the basis of environmental criteria. The price of short-term vignettes – typically purchased by foreign drivers – was to decrease in relation to the annual rate and be set below a certain ratio. In addition, the most environmentally friendly vehicles were to be given favorable treatment in the annual vehicle tax.

The Commission put infringement proceedings on hold.

MEPs have asked the Commission to explain why it thinks the revised proposals are sufficient to justify the suspension of infringement proceedings. They also requested that the Commission provide relevant information on its analysis of the new measures and their conformity with EU law.

TAGS: environment | tax | European Commission | vehicle tax | law | Germany | European Union (EU) | Europe

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