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Netherlands to charge road tax by the kilometre

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Netherlands to charge road tax by the kilometre

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The Netherlands has said it is to scrap all road and vehicle tax by 2012 and replace it with a ‘green’ charge based on the distance driven.

The government hopes the measure will eventually reduce CO2 emissions by 10 percent. Under the proposed plans motorists would initially pay 3 euro cents per kilometre, rising to 6.7 cents by 2018. Currently, taxes are estimated to make up about 25 percent of the cost of a new car. ‘‘At the moment, when you buy a mid-range car, you have to pay ‘car registration tax’ of more than 10,000 euros,’‘ said transport minister Camiel Eurlings. The government and drivers’ groups are also hopeful the levy will cut congestion, cutting the total number of kilometres driven in the Netherlands by 15 percent. Under the bill, which still needs to go before the Dutch parliament, cars will have a rate dependant on their weight, size and carbon output. Certain vehicles however, such as taxis, buses and motorcyles, are expected to be exempt.