25 November 2009

Pay per Drive in Holland

Driving Cars Kills Your Street Cred

In an effort to reduce automobile usage and greenhouse gas emissions, the Dutch cabinet has approved a driving tax that would charge motorists three cents per kilometre, [0.07 US cents per mile]with higher charges levied during rush hour and for traveling on congested roads. Trucks, commercial vehicles and bigger cars emitting more carbon dioxide will be assessed at a higher rate.

The plan, which must still be approved by parliament, would use GPS systems installed in each car to keep track of mileage and automatically bill drivers.

Dutch officials said the driving tax, which would replace existing road taxes and duties on new car purchases, is designed to cut traffic by 15 percent and reduce emissions from transport by 10 percent.

Other European nations are considering similar driving taxes, and a driving tax experiment was recently tried in Oregon in the United States. The chances of a tax comparable to the Dutch tax being levied in the U.S. are slim, however, as that would more than triple the $260 a year that the average U.S. driver now pays in state and federal gasoline taxes.

Thanks to Joel for the link. Also via: AP


portlandize.com said...

But the U.S. gas tax pays for all the roads in the U.S., doesn't it? :D

God forbid that the average citizen should know what the roads actually cost, how much they have to be maintained, and how much *everyone* ends up paying for them, even those who cause little to no wear on them, or are not even allowed to use them (in the case of freeways).

I think this model of taxation makes a lot of sense, though it would be a bit difficult to implement on a population of 300 million. I think the privacy concerns would also kill this one pretty quickly in the U.S.

Murk said...

If you want to tax by the mile with more polluting vehicles paying more, you don't need GPS in every car with a central database, you need a levy on the fuel.

.... oh, I forgot. We already have that.

Frits B said...

I would like to point out that similar plans have been introduced since 1972, and they never made it into reality. The technology does exist now but there is massive objection to the new plan and the minister concerned has already withdrawn a very essential part of the proposal (the surcharge on driving in rush hours) as this would ruin the economy. Also the Constitutional Court (Raad van State) has warned that in its present form the plan is not acceptable because its implications with regard to civic liberties.

BTW, a side effect of the plan would be that car prices would go down considerably as purchase tax and road tax will be abolished. Commentators pointed out that cars are very desirable goods which so far were not easily affordable; they will be after the introduction of the new system, so it is expected that car ownership will go up. And where would all these extra cars go? Right, parked on the streets. Entirely illogical as it's exactly the lack of road space that spawned the plan.

The government knows this. They don't have the courage to enter the bill during the present legislation period, and leave it to the next cabinet to argue with parliament. And the present state of the economy also doesn't favour experiments of this kind; we simply don't have the money.

Zweiradler said...

Did you mean 0.07 US Dollar?

Mikael said...

€0.03 per km.
$0.07 per mile.

Frits B said...

"€0.03 per km.
$0.07 per mile."
For very small cars and for the first year only. After that the price doubles every year. And if we do manage to take 15% off the annual mileage, the rate will have to be upped because the tax revenue would then be less than before.

Forgive me if I'm skeptic, even though I wouldn't be affected as I don't own a car.

Miguel said...

The problem with this is that imposing the tax without providing drivers a credible alternative form of transportation is nasty. We need to dramatically reduce use of cars but alternatives need to exist. You shouldn't simply raise taxes and end of story.

It would be a good incentive had alternatives in general existed. Such is the case in much of Europe. Too many people in Madrid, for example, are lazy/self-centered to consider commuting or biking. A tax would be an incentive (though it's an a badly distributed incentive: If you are rich, you simply don't care such a tax).

Anonymous said...

This tax is a bad idea:
1: Will reinforce class differences -- the rich continue to drive as much as they like and park as long as they like in expensive city-parking, while the rest of us lower-class plebs walk and cycle. It associates cars once again with wealth & exclusive freedoms, and damages the ability to educate all kids, rich and poor, that private cars are generally an unhealthy blight, and driving a kilometre to get a coffee is antisocial.
2. Personal greenwash. People will shrug off their responsibility, thinking, "I pay for the urban blight/ noise/ pollution that MY car produces, so I'm quits".
3. Political parties can in future appease the voters by reducing the tax - which immediately incentivises driving again.
4. People in rural areas will be hit badly; just the places where public transport is usually worst.
5. Scams will immediately pop up that let wealthier people exploit any discounts at the expense of the rest (e.g., registering their car at their second home in the country).
6. To make pay-per-distance work will take yet more surveillance; we REALLY don't need that.

Anonymous said...

Oh, and
7: Mileage tax will positively promote the ownership of short-distance resource-guzzlers - the little-luxury one-kilometre latte fetch - taking up manufacturing resources and street space while it lies empty all week...with the owner using (subsidized) public transport to commute.

Far as I can see, the (taxpayer-subsidised) motor-manufacturing lobby and (taxpayer-paid) road-construction industries are the clear winners of mileage tax, with petroleum companies next, and then the (taxpayer-subsidised) public transport cartels. Which leaves the environmental impact and the pocket-impact for the rest of us suckers to suffer.


tedsfiles said...

I think they should simply double the price of fuel, and spend the extra money on the transport alternatives.
If this stops poor people from driving, then good! Cars cost around 5 to $10,000 per year, so if you ride a $500 bike instead, then this will be a major win for your pocket.
Fuel should reflect the true cost of cars, so that people wouldnt' do it unless they really need to. At the moment, everyone jumps in their car without a second thought.

Neil said...

In general, I think that this kind of technology based solution is inferior to traditional gas taxes. It only discourages one behaviour (driving), while failing to provide a good incentive for using a fuel-efficient vehicle when you do drive. A gas tax covers both bases.

Really, governments should just wall off the road budget from general revenues. If you can't build and maintain a road from the gas taxes, then don't. Or increase the tax until you can.