Diesel and petrol prices in selected countries (US cents per litre) - Source: GIZ - International Fuel Prices, 2011

The conflicting objectives of fuel taxation

The transport sector is almost completely reliant (95 per cent) on petroleum products, such as gasoline and diesel. From an environmental point of view, increasing fuel taxes is perceived to be central in reducing the dominance of oil in transport. Tax increases therefore facilitate the transition to a cleaner, greener future. This would, however, mean a significant loss of revenue to many governments.

FROM a government’s perspective, fuel taxes (also called motoring taxes or fuel duties) are attractive. In theory, they can serve several policy objectives.

They can raise substantial revenues. The tax base is large and because tr...

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Dr. Carole Nakhle
A report published by the Institute of Fiscal Studies found that in the UK revenue from motoring taxation is set to drop to £25 billion by 2029 due to the improvement in the fuel efficiency of vehicles
read more about it in the report
Who will benefit?
  • Report is targeted to the decision makers in cross country manufacturing – suppliers, manufacturers, logistics.
  • Also considered useful for the administrative university facilities, to better understand the possible effects of current decisions.
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