The conflicting objectives of fuel taxation

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

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.

[[quote]]

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

Not a subscriber yet?

Subscribe now and get the latest in-depth geopolitical analysis and forecasts from GIS’s unrivaled cadre of experts.

Learn more about our subscription plans.

You can also buy this report for €8.99 Buy

Add your comment