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With regard to cars, I think car taxes, yearly but especially on new cars, are much more promising (because they're less politically dangerous) than fuel taxes.

The eco tax in Germany was introduced in 1999 and ramped up until 2003 (increasing taxes on petrol by 30% and on diesel by 50%). Since then fuel prices have continued to rise. Still, I see hordes of Cayenne, Touareg, M Class, X5, Q7 SUVs all around me. The problem is that European SUVs are largely luxury SUVs and the people who can afford them, the haves and the have mores, can also easily afford higher gas prices.

The kind of fuel taxes that you need to curb this kind of luxury consumption are just not going to get a political majority. Atrios is right on that in the US and his point also goes for the EU. We can talk about what would work as if we are detached from the need to command political majorities and detached from the constraints of existing institutions, but I don't think that is very useful.

Fuel taxes in the EU will first require a new treaty or a two-speed Europe because they now require unanimity. And even then, I think it is very optimistic to even hope for an increase of 50 eurocents, phased in slowly.

by nanne (zwaerdenmaecker@gmail.com) on Wed Jun 20th, 2007 at 06:54:23 AM EST
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