Climate Council to the government: Raise the tax on diesel now
Denmark makes money on cross-border trade in diesel for trucks. It must stop.
In Germany, a liter of diesel costs 75 øre more in tax than it does in Denmark (0.10 euro).
It may not sound like much, but if you are a truck driver and own several trucks, each consuming a lot of diesel, then it means a lot.
We always try to refuel up here because it is cheaper, says Marcel Schwaigert a German driver who has been stopped at the transport center in Padborg to fill up with diesel in his car.
He is far from the only one who does. In fact, there is a fairly extensive cross-border trade in diesel on the Danish side of the border, and since the Germans introduced a CO2 tax on diesel at New Year’s, which has caused the price to rise further, it has become even more attractive to refuel in Denmark.
The Climate Council, which advises the government on the green transition, would like to put an end to this.
In a new report with recommendations for greener truck traffic, the council recommends raising the tax on diesel here and now so that it will cost roughly the same on both sides of the border.
Bad deal.
Denmark earns roughly one billion kroner a year on cross-border trade in diesel (134 million euro). And since the Germans raised their taxes on diesel by New Year, it will, according to the Ministry of Taxation’s assessment, increase to DKK 1.6 billion this year (215 milllion euro).
While cross-border trade is good for the Treasury, it is the opposite bad for Danish climate efforts. For the diesel sold in Denmark counts in the Danish CO2 accounts.
This means that we get some extra CO2 emissions. So when we have to reach our goal in 2030, we have to find correspondingly more reductions elsewhere due to cross-border trade, says Niels Buus Kristensen, who sits on the Climate Council and is also head of research at the Department of Transport Economics in Oslo.
According to the Climate Council’s report, cross-border trade in 2019 meant that 0.7 million tonnes of extra CO2 was added to Denmark’s climate accounts.
In addition, the Ministry of Taxation estimates that the higher taxes in Germany will mean an additional discharge of around 0.3 million tonnes.
Overall, cross-border trade in diesel means an emission of around one million tonnes of CO2 – or the equivalent of five percent of the CO2 that Denmark must save in 2030 to live up to our climate goals.
Or to put it another way: If cross-border trade were stopped, Denmark would save more CO2 than on the agreement that has been made to sort and recycle more of our waste.
However, not everyone agrees that taxes should go up.
I do not think that is the right way forward. A tax increase will just make it more expensive for hauliers, says Erik Østergaard, director of Danske Transport og Logistik.
Fuel makes up a really big part of their cost and they can not take it out of their own bottom line. It is passed on to the next link in the chain. That is, consumers and businesses that are going to absorb these tax increases, he says.
Transport Minister Benny Engelbrecht also does not believe that the tax on diesel should go up. He points out that a decision has already been taken to introduce a CO2 tax and a toll for lorries.
In this way, it is ensured that both foreign and Danish trucks pay the same CO2 tax, he says.
The Climate Council is also in favor of both a high CO2 tax and a driving tax. But they stress that both are some years out in the future.
We think that until we get those things in place, it is a good idea to increase the diesel tax to stop cross-border trade, says Niels Buus Kristensen.
Green trucks
The proposal for the diesel tax is one of a number of proposals in a new report from the Climate Council on how we can best adapt the heavy transport, which today emits 1.7 million tonnes of CO2.
The overall call from the Climate Council to the politicians is that they must bet that the trucks in the future can be electrified either by running on batteries or on hydrogen, which is also made from renewable energy.
This could become a reality, for example, by establishing river roads where the lorries can recharge their lorries on selected sections.
Something that both Sweden and Germany are currently experimenting with.
In other countries, a number of trucks are already driving around on biogas, but the Climate Council warns against going that route, as we do not have infinite amounts of biogas. And the biogas that is, other industries need more.
Here are the Climate Council’s recommendations:
Make a strategy for the conversion of heavy transport
Set up the tax on diesel now and here – as a precursor to a general CO2 tax
Consider charging for larger vehicles when building charging stations
Pressure in the EU to clarify whether to invest in river roads
Stop subsidies for gas trucks – Denmark must focus on electrification
A lot of renewable energy will be used for transport in the future build more offshore wind and other renewable energy
Far left climate activist parties are probably salivating at the thought of higher taxes and polishing the national co2 balance. But how is such ideas improving the co2 balance for the EU.
IDK, maybe this is not the right time to make life harder for lorry drivers.
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Google Translate:
Climate Council to the government: Raise the tax on diesel now
Denmark makes money on cross-border trade in diesel for trucks. It must stop.
In Germany, a liter of diesel costs 75 øre more in tax than it does in Denmark (0.10 euro).
It may not sound like much, but if you are a truck driver and own several trucks, each consuming a lot of diesel, then it means a lot.
We always try to refuel up here because it is cheaper, says Marcel Schwaigert a German driver who has been stopped at the transport center in Padborg to fill up with diesel in his car.
He is far from the only one who does. In fact, there is a fairly extensive cross-border trade in diesel on the Danish side of the border, and since the Germans introduced a CO2 tax on diesel at New Year’s, which has caused the price to rise further, it has become even more attractive to refuel in Denmark.
The Climate Council, which advises the government on the green transition, would like to put an end to this.
In a new report with recommendations for greener truck traffic, the council recommends raising the tax on diesel here and now so that it will cost roughly the same on both sides of the border.
Bad deal.
Denmark earns roughly one billion kroner a year on cross-border trade in diesel (134 million euro). And since the Germans raised their taxes on diesel by New Year, it will, according to the Ministry of Taxation’s assessment, increase to DKK 1.6 billion this year (215 milllion euro).
While cross-border trade is good for the Treasury, it is the opposite bad for Danish climate efforts. For the diesel sold in Denmark counts in the Danish CO2 accounts.
This means that we get some extra CO2 emissions. So when we have to reach our goal in 2030, we have to find correspondingly more reductions elsewhere due to cross-border trade, says Niels Buus Kristensen, who sits on the Climate Council and is also head of research at the Department of Transport Economics in Oslo.
According to the Climate Council’s report, cross-border trade in 2019 meant that 0.7 million tonnes of extra CO2 was added to Denmark’s climate accounts.
In addition, the Ministry of Taxation estimates that the higher taxes in Germany will mean an additional discharge of around 0.3 million tonnes.
Overall, cross-border trade in diesel means an emission of around one million tonnes of CO2 – or the equivalent of five percent of the CO2 that Denmark must save in 2030 to live up to our climate goals.
Or to put it another way: If cross-border trade were stopped, Denmark would save more CO2 than on the agreement that has been made to sort and recycle more of our waste.
However, not everyone agrees that taxes should go up.
I do not think that is the right way forward. A tax increase will just make it more expensive for hauliers, says Erik Østergaard, director of Danske Transport og Logistik.
Fuel makes up a really big part of their cost and they can not take it out of their own bottom line. It is passed on to the next link in the chain. That is, consumers and businesses that are going to absorb these tax increases, he says.
Transport Minister Benny Engelbrecht also does not believe that the tax on diesel should go up. He points out that a decision has already been taken to introduce a CO2 tax and a toll for lorries.
In this way, it is ensured that both foreign and Danish trucks pay the same CO2 tax, he says.
The Climate Council is also in favor of both a high CO2 tax and a driving tax. But they stress that both are some years out in the future.
We think that until we get those things in place, it is a good idea to increase the diesel tax to stop cross-border trade, says Niels Buus Kristensen.
Green trucks
The proposal for the diesel tax is one of a number of proposals in a new report from the Climate Council on how we can best adapt the heavy transport, which today emits 1.7 million tonnes of CO2.
The overall call from the Climate Council to the politicians is that they must bet that the trucks in the future can be electrified either by running on batteries or on hydrogen, which is also made from renewable energy.
This could become a reality, for example, by establishing river roads where the lorries can recharge their lorries on selected sections.
Something that both Sweden and Germany are currently experimenting with.
In other countries, a number of trucks are already driving around on biogas, but the Climate Council warns against going that route, as we do not have infinite amounts of biogas. And the biogas that is, other industries need more.
Here are the Climate Council’s recommendations:
Make a strategy for the conversion of heavy transport
Set up the tax on diesel now and here – as a precursor to a general CO2 tax
Consider charging for larger vehicles when building charging stations
Pressure in the EU to clarify whether to invest in river roads
Stop subsidies for gas trucks – Denmark must focus on electrification
A lot of renewable energy will be used for transport in the future build more offshore wind and other renewable energy
Far left climate activist parties are probably salivating at the thought of higher taxes and polishing the national co2 balance. But how is such ideas improving the co2 balance for the EU.
IDK, maybe this is not the right time to make life harder for lorry drivers.