AutoblogGreen

1. "presumed greenhouse gas"? Strange way to put it. There's nothing presumed about it! Maybe some subtlety was lost in translation...

Posted at 2:21AM on Aug 31st 2007 by Scatter

2. "He also says that fuel in Germany, at about $6.75 a gallon, is still too expensive."

I don't have a subscription to the article but the rest of your summary implies that Mr. Reinking actually feels fuel in Germany is still not expensive enough.

His proposal appears to be scrapping the vehicle license fee, which is currently based on engine displacement. There have been calls to base it on certified CO2 emissions in the NEDC instead. Mr. Reinking's argument is that this is essentially the same as taxing fuel consumption, in which case you might as well cut the bureaucratic overheads and switch to a tax strategy based on actual fuel consumption alone.

There are two things he glosses over:

(a) in Germany, vehicle license fees are one of very few taxes that the individual states (Laender) levy directly. By contrast, fuel tax revenue accrues to the federal ministry of finance.

(b) consumption-based taxes, by their nature, tend to hit poorer sections of the population hardest. Wrt fuel, the situation is not as extreme in densely populated Europe as it is in the US, where low-cost housing is often far removed from the jobs those living there have to commute to. However, German authorities did recently eliminate a tax break for commuters.

In summary, a politically more feasible and socially more neutral approach would be to cut general sales tax (currently 19% in Germany) while raising fuel taxes. Consumers could then "earn" a net tax cut by driving less, driving more efficiently and/or choosing a vehicle that gets better mileage.

Posted at 8:07AM on Aug 31st 2007 by rgseidl

3. "He also says that fuel in Germany, at about $6.75 a gallon, is still too expensive."

I don't have a subscription to the article but the rest of your summary implies that Mr. Reinking actually feels fuel in Germany is still *not expensive enough*.

His proposal appears to be scrapping the vehicle license fee, which is currently based on engine displacement. There have been calls to base it on certified CO2 emissions in the NEDC instead. Mr. Reinking's argument is that this is essentially the same as taxing fuel consumption, in which case you might as well cut the bureaucratic overheads and switch to a tax strategy based on actual fuel consumption alone.

There are two things he glosses over:

(a) in Germany, vehicle license fees are one of very few taxes that the individual states (Laender) levy directly. By contrast, fuel tax revenue accrues to the federal ministry of finance.

(b) consumption-based taxes, by their nature, tend to hit poorer sections of the population hardest. Wrt fuel, the situation is not as extreme in densely populated Europe as it is in the US, where low-cost housing is often far removed from the jobs those living there have to commute to. However, German authorities did recently eliminate a tax break for commuters.

In summary, a politically more feasible and socially more neutral approach would be to cut general sales tax (currently 19% in Germany) while raising fuel taxes. Consumers could then "earn" a net tax cut by driving less, driving more efficiently and/or choosing a vehicle that gets better mileage.

Posted at 8:08AM on Aug 31st 2007 by rgseidl