The Efficient Combination of Taxes on Fuel and Vehicles

Arbeitspapier

A tax on fuel combined with tax-exemptions or subsidies for purchase of fuel-efficient vehicles is implemented in many countries to reduce greenhouse gas emissions and other negative externalities from road traffic. This study, however, shows that a tax on fuel should be combined with heavier taxation of fuel-efficient vehicles to curb externalities from road traffic. The tax on fuel is implemented to curb externalities linked to both consumption of fuel and road use. The heavier tax on fuel-efficient vehicles prevents that motorists avoid the road user charge on fuel by purchasing fuel-efficient vehicles.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 6789

Classification and Topics

• Classification: Wirtschaft ; Taxation, Subsidies, and Revenue: General ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies ; Environmental Economics: Government Policy ; Transportation Economics: Government Pricing and Policy
• Subject: transportation ; optimal taxation ; environmental taxation ; global warming

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bjertnæs, Geir H. M.
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2017

Further information

• Handle: http://hdl.handle.net/10419/174912
• Last update: 10.03.2025, 11:44 AM CET