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economic instruments
The document discusses economic instruments for sustainable urban transport, specifically fuel taxation. It notes a gap between local transport needs and available financing. Major actors in transport financing are identified as citizens, donors, city administrations, national governments, and the private sector. Fuel taxes and surcharges are discussed as a way to both generate revenue for transport systems and reduce car usage. The document provides examples of fuel taxes and surcharges in Colombia and discusses principles of fuel pricing policies.
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economic instruments
- 1. Seite 1 Economic Instruments ManfredBreithaupt (GIZ)
- 2. Seite 2 Why financingis important? Photos by Manfred Breithaupt, Santhosh Kodulka, Carlos F. Pardo, Santhosh Kodukula, Ko Sakamoto, Soul Development Institut Photo by Manfred Breithaupt, Transmilenio Sustainable Urban Transport Gap between local needs and the available financial resources •Car-orientated investment •Poor provisions for pedestrians and cyclists •Lack of resources for high quality public transport system
- 3. Seite 3 Major Actors Financingof urban transport The image part with relationship ID rId3 was not found in the file. Citizens Donors and International Organisations City administration National and regional governments Private sector Photo by Christopher Kost Photo by Georg Döhn Photo by Carlos F. Pardo
- 4. Seite 4 EconomicInstruments (incl.vehicleandfueltaxation)can be integral part of TravelDemandManagement….. • recognizing that travel demand is not given, but is a function of transportation policies, pricing,investments, choices • is vital to create high performance, cost-effective transportation systems • is the natural complement to transportation supply management, land use planning,and environmental/natural resource management. They aim at - creating more revenues to set up a sustainable urban transport system - Reduce car usage in city centers and shift demand to SUT modes
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- 6. Seite 6 Fuel Taxesand Surcharges National Instruments Charges on fuels levied by governments, sometimes additional fuel surcharges by provinces of cities Characteristics: • Simple, cost-efficient and reliable way of charging • Most appropriate way to focus on the user-pay-principle • Political acceptability sometimes problematic, political pressure sometimes keep fuel prices low Photo by Varano Case Study: Fuel surcharge in Colombia •In all Colombian cities a 20% surcharge to all gasoline sales is levied •Half of revenues are used for Bogotá’s TransMilenio System •Private vehicle owners finance one third of a mass transport system •72% of passengers belong to low income citizens “On a global level between 80 to 90% of all revenues derived from the transport sector are being raised from fuel taxes”
- 7. Seite 7 Example: ColombiaURBAN fuel surcharge • Colombian cities have a 20% surcharge on gasoline sales • Half of Bogotá’s surcharge revenues are for Bogotá’s TransMilenioSystem • Private vehicle owners finance one third of mass transport system Photos by TransMilenio and Varano Some Fuel Taxes and Surchargesare Local!
- 8. Seite 8 International FuelPrices § January 2011:Failed attempt to raise price in Bolivia § January 2012:Semi- successful price increase in Nigeria (from 65 Naira to 141 Naira, back to 97 Naira after two weeks of protest) § March 2012:Two price adjustemnts in PRC: Gasoline prices have smashed the 8 yuan per litre ($1.27) benchmark § April 2012: Failed attempt to raise prices in Indonesia with significantunrest § May 2012:German government commences price monitoring § Spring 2012:Fuel prices are major US election campaign issue § Since 1991 GIZ carries out regular worldwide surveys on fuel prices. One of its goals is to provide a worldwide comparison of retail prices to track energy price policies in developing countries. § Currently, data are available for 170 countries for Diesel and Gasoline based on survey in Mid- November 2012 § Data are part of World Bank Indicator Set (World Development Indicators, World Road Statistics, …) § Results of 2012 Survey available on: www.giz.de/fuelprices § Fuel prices remain a political issue with high potential for discontent (see column) Our work
- 9. Seite 9 International FuelPrices October 2014 Armin Wagner, [email protected]
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- 12. Seite 12 International FuelPrices § Fuel price policies are built on four dimensions: price levels, regulation, transparency and enforcement. § The following charts provide a brief overview of these dimensions. Four Dimensions of Fuel Pricing
- 13. Seite 13 Lowest EU-27level Crude oil price ("Brent“) US retail price level High fuel taxation Fuel taxation Fuel subsidies High fuel subsidies Fuel Taxation Category 1: High Fuel Subsidies The retail price of fuel is below the price for crude oil on world market. Fuel Taxation Category 2: Fuel Subsidies The retail price of fuel is above the price for crude oil on world market and below the price level of the United States. Note: The fuel prices of the United States are average cost-covering retail prices incl. industry margin, VAT and incl. approx. US 10 cents for the 2 road funds (federal and state). This fuel price may be considered as the international minimum benchmark for a non-subsidised road transport policy. Fuel Taxation Category 3: Fuel Taxation The retail price of fuel is above the price level of the United States and below the price level of Romania (Luxembourg). Note: In November 2010, fuel prices in Romania (Luxembourg) were the lowest in EU-27. Prices in EU countries are subject to VAT, fuel taxes as well as other country-specific duties and taxes. Fuel Taxation Category 4: High Fuel Taxation The retail price of fuel is above the price level of Romania (Luxembourg). 4 country categories to benchmark transport and energy policies: 1: Fuel Price Level - Categorisation
- 14. Seite 14 Principle 1:Cover Production / Transport / Refinery Costs Fuel prices cover the full costs of production/import, transport and refining including depreciation and external costs of production (e.g. environmental costs) Principle 2: Fuel taxes help finance the transport sector Fuel taxes contribute to sustainable development of the transport sector Road maintenance financing (rule of thumb: minimum of US 10 cents for road maintenance, including 20 % for rural roads) Principle 3: Internalise external effects of transport sector Directly related to fuel consumption and CO2 emissions. Proxy for other social costs (like accidents (cf. road safety cent, congestion, etc.). Eco-Tax. Principle 4: Fuel taxes contribute to general state budget Major contribution towards financing core state functions such as the health services, education and security. As fuel taxes are easy to collect, they are a major source of revenue in many countries. Subject to full VAT as any other good. 05.10.15 1: Fuel Price Level - Principles
- 15. Seite 15 Description Examples Adhoc price regulation Ad-hoc price changes over long intervals or constant prices over several years Saudi Arabia, Bolivia,Qatar, Nigeria,Indonesia Active price regulation Prices are regulated and reviewed based on pre-determined criteria and / or formulae and often at regular intervals (weekly,monthly) South Africa, PR China, Vietnam Passive or no price regulation Regulation is limited to the level of taxes and frame conditions (e.g. fuel qualities) Germany, USA Time Price Time Price Time Price 2: Price Regulation - Categories
- 16. Seite 16 0 2 4 6 8 10 12 0 20 40 60 80 100 120 140 160 Jan 08 Mar MayJulySep Nov Jan 09 Mar May JulySep Nov Jan 10 Mar May JulySep Nov USD/Rand USCents/litre Gasoline Diesel Brent Crude Exchange Rate (USD/Rand) International Fuel Prices The “Energy Department of South Africa” is a governmental institution in charge of regulating fuel prices. The “National Petroleum, Gas and Oil Corporation of South Africa” (PetroSA) is the national oil company, operating refineries and oil rigs. Fuel prices are calculated based on elaborated formulas and methods. The Basic Fuel Price (BFP) is the refinery price for one litre of fuel, including the price for crude oil and any import, handling and (sea-)transportation costs. Inland transportation costs, wholesale margins and distribution costs are calculated taking into account the approximate, actual costs and also some limited commercial profit (between 10% and 20% on the depreciated book value of assets per year, calculated for a fictive, average company; if the actual value exceeds this interval, margins are recalculated). Pump prices for petrol and wholesale prices for diesel are regulated – i.e. the retail margins for diesel are liberal. Slate Levy / Slate Account: Since the BFP changes daily (because of the crude oil price and the US$ exchange rate), but fuel prices are regulated only monthly, differences arise. I.e. customers pay too much on some days or too less on other days each month. This price differences are multiplied by the approximate amount of fuel sold at that specific day and summed up over one month. This sum is then cleared with a consistent “Slate Account”. A Slate Levy is only imposed for the next month, if this Slate Account balance drops below zero (as of September 2010, the Slate Account balances are almost +900 Mio. Rand for Petrol and ~ +310 Mio Rand for Diesel). Several levies are imposed, including a levy for the Road Accident Fund (RAF) of 0.72 Rand/litre (as of Nov.2010). Fuel Price Regulation: Example South Africa
- 17. Seite 17 Principle 1:Reflect changes in cost of production, transport and refinery Fuel prices adjustments reflect changes in cost of production/import, transport and refinery, including depreciation and external costs of production (e.g. environmental costs) Principle 2: Allow for inflationary adjustment Fuel pricing scheme allows for adjustment to inflationary (and increase in income) Principle 3: Limit budgetary consequences Fuel price adjustments limit budgetary impact and indicate clear exit strategies (in case of subsidies) 05.10.15 2: Price Regulation - Principles
- 18. Seite 18 0 0,2 0,4 0,6 0,8 1 1,2 1,4 Crude+ refinery+ margins ? How transparentare composition and regulation of fuel prices? 3: Transparency – 3 Examples 0,80 0,03 0,16 0,20 0,00 0,20 0,40 0,60 0,80 1,00 1,20 1,40 VAT Specific Excise Duty Dealer Commission Price Charged to Dealers 0,62 0,11 0,08 0,11 0,00 0,20 0,40 0,60 0,80 1,00 1,20 1,40 Taxes Distribution and Marketing Refining Crude Oil Delhi effective 16-04-14 (USD / litre) Source India: https://iocl.com/Products/PriceBuildup/Price_buildup_of_MS.pdf Source USA: http://www.eia.gov/petroleum/gasdiesel/ U.S. Regular Gasoline (USD/litre) April 2014 Saudi Arabia
- 19. Seite 19 Principle 1:Institutional stakeholders in price setting are known Provide information on institutional stakeholders involved in determination of price levels and elaboration of price adjustments Principle 2: Principles of price setting are known Provide information on determinants for pricing, on frequency of updates and the underlying formula if automatic mechanisms are applied. Principle 3: Information on price composition is available Publish information on taxation levels and composition of fuel prices Principle 4: Information on prices and price setting are made public in an easy-to-access, comprehensible and accountable manner Information is displayed on the Web including: Current price data for all fuel products; timelines of prices; price components (production and/or import prices, taxation levels, and other charges); description of structure and modus operandi of pricing mechanisms (if applied); underlying legislation. 05.10.15 3: Transparency - Principles
- 20. Seite 20 Issues: §Enforcement ofregulated prices or transparency regulations §Prevention of black markets and smuggling §Prevention of adulteration (e.g. kerosene and diesel) 05.10.15 4: Enforcement
- 21. Seite 21 0 200 400 600 800 1000 1200 Nov 07Dec 07 Jan 08 Feb 08 Mar 08 Apr 08 May 08 Jun 08 Jul 08 Aug 08 Sep 08 Oct 08 RSA-cents/litre 0 50 100 150 200 250 300 350 400 450 01.10.2007 01.11.2007 01.12.2007 01.01.2008 01.02.2008 01.03.2008 01.04.2008 01.05.2008 01.06.2008 01.07.2008 01.08.2008 01.09.2008 01.10.2008 01.11.2008 US-cents/gallon 0 100 200 300 400 500 600 700 800 900 Nov 07 Dez 07 Jan 08 Feb 08 M rz 08 Apr08 M ai08 Jun 08 Jul08 Aug 08 Sep 08 O kt08 Nov 08 CFAFranc/Liter Transparency / Targeting Monitoring / Information Objective: Move towards rational pricing, increase transparency and improve targeting of subsidies Objective: Increase transparency, build trust through accountability and de-politize fuel pricing Objective: Increase transparency through government-sponsored monitoring and other information initatives Reform Approach in Four Dimensions Ad hoc regulation Active regulation Passive or no regulation International Fuel Prices Very high fuel taxation Fuel taxation Fuel subsidies Very high fuel subsidies
- 22. Seite 22 International FuelPrices 0 200 400 600 800 1000 1200 Nov 07 Dec 07 Jan 08 Feb 08 Mar 08 Apr 08 May 08 Jun 08 Jul 08 Aug 08 Sep 08 Oct 08 RSA-cents/litre 0 50 100 150 200 250 300 350 400 450 01.10.2007 01.11.2007 01.12.2007 01.01.2008 01.02.2008 01.03.2008 01.04.2008 01.05.2008 01.06.2008 01.07.2008 01.08.2008 01.09.2008 01.10.2008 01.11.2008 US-cents/gallon 0 100 200 300 400 500 600 700 800 900 Nov 07 Dez 07 Jan 08 Feb 08 M rz 08 Apr08 M ai08 Jun 08 Jul08 Aug 08 Sep 08 O kt08 Nov 08 CFAFranc/Liter X – Price increase without reform of regulation and limited transparency (big bang theory) √ – 2nd step: Reform of regulation (move towards formulae based pricing mechanism with regular price review) √ – 3rd step: Gradual price increases (e.g. with indexation) √ – 1st step: Increase transparency (of composition of prices and of regulatory approach) Ad hoc regulation Active regulation Passive or no regulation Transparency Very high fuel taxation Fuel taxation Fuel subsidies Very high fuel subsidies Reform Approach in Four Dimensions: Example
- 23. Seite 23 International FuelPrices Fuel Prices, Fuel Quality and Energy Efficiency in the Transport Sector ...Urban Sprawl with high travel distances ...Excessive car use ...Inefficient vehicles Low or even subsidized fuel prices encourage... Low or even subsidized fuel prices encourage... ...under-recovering of refineries with fuel shortages ...Low quality fuels ...Lack of innovationin car industry Vicious momentum of low fuel prices in the transport sector
- 24. Seite 24 International FuelPrices ...Dense and transit oriented development ...Walking and use of busses, trams, bicycles ...Efficient operation of traffic High fuel prices encourage... High fuel prices encourage... ...Investment in high quality fuels ...Innovationin car industry Positive momentum of high fuel prices in the transport sector Fuel Prices, Fuel Quality and Energy Efficiency in the Transport Sector
- 25. Seite 25 Open issues:Diesel 0 0,2 0,4 0,6 0,8 1 1,2 1,4 1,6 1,8 2 Egypt Ecuador Brunei Bangladesh Jordan Sudan Cuba SriLanka Brazil Singapore Grenada IvoryCoast Japan Madagascar Mauritius Lebanon Peru Kuwait Macedonia LaoPDR BurkinaFaso Korea,South Malta Fiji Kenya Zimbabwe Ukraine Lithuania China,P.R. Finland Mongolia Italy Montenegro CzechRepublic Guyana Latvia CentralAfricanRepublic Maldives Poland Congo,DemocraticRep.Of Indonesia Qatar Spain Zambia RussianFederation Botswana Georgia SouthAfrica Iceland UnitedKingdom Israel Liechtenstein UnitedStates UnitedArabEmirates Diesel / gasoline price ratio Diesel more expensive than gasoline Diesel less expensive than gasoline
- 26. Seite 26 Fuel pricelevels should “tell the economic and ecological truth” Regulation of fuel prices need to reflect a number of principles Transparency in fuel price regulation fosters public participation and broader political support Increase attention to diesel/kerosene pricing; pricing of nat. gas Good practice: Fuel taxation based on carbon content (avoid subsidization of diesel fuel) Good practice: Adopt a stepwise (yearly) increase in fuel taxation in just one legislative act (avoiding a permanent political discussion) Good practice: road tolls for freight transport (avoiding and compensating for fuel tourism) 05.10.15 Reform of transport fuel taxes - Conclusions
- 27. Seite 27 International FuelPrices Our Resources GIZ Fuel Price News: § Monthly collection of global fuel price news § Recommended reading on related publications Report “International Fuel Prices”: § Overview and data on retail prices of gasoline and diesel in more than 170 countries § Detailed information on price levels, pricing dimension, subsidies, taxation, regulation and transparency § Published every two years, last in 10-2014 Factsheets: § Offer compact information on two pages: § Price in USD and local currency (some since 1991) § Price composition § Pricing policy § Transparency-traffic-signalon price composition and pricing policy Website: www.giz.de/fuelprices Report International Fuel Prices Monthly newsletter
- 28. Seite 28 International FuelPrices Our "International Fuel Prices Observatory” factsheets offer compact information on two pages: •Price in USD and local currency (some since 1991) •Price composition (production costs, taxes, fees, margins, etc) •Pricing policy •Transparency-traffic-signal on price composition and pricing policy •Related Links Page 1
- 29. Seite 29 International FuelPrices Our "International Fuel Prices Observatory” factsheets offer compact information on two pages: •Price in USD and local currency (some since 1991) •Price composition (production costs, taxes, fees, margins, etc) •Pricing policy •Transparency-traffic-signal on price composition and pricing policy •Related Links
- 30. Seite 30 Tax orcharge on car purchase and/or ownership Characteristics: • Taxes are very flexible, can be varied depending on engine size, carbon emissions, environmental standards, weight or number of axles • Taxes are able to reflect externalities . Generally surprisinglyhigh political acceptability (up to a point) . Usually set nationally; not for sake of local context Photo by Karl Fjellstrom National Instruments
- 31. Seite 31 19 memberstates levy CO2-related taxation on cars. Source: www.acea.be EU countries • At least 20 of the EU‘s 28 member states apply CO2 – based car taxation • At least 18 countries also offer incentives (cash & tax exemption) for buying electric vehicles Vehicle-Related Taxes and Charges
- 32. Seite 32 Case Study:Environmentally-orientated taxation system for new cars in France Since January 1, 2008, a car owner who buys a new car emitting more than 160 grams of carbon dioxide per kilometer will be charged a one- off penalty of up to €8 000 ($9950). Photo by Manfred Breithaupt Photo by http://www.knmaltitude.com/ Flight%20Attendant%20Training.html Vehicle-Related Taxes and Charges
- 33. Seite 33 • Buyersof more environmentally-friendly cars receive a bonus ranging from €150 ($187) to €6,300 ($7,840), depending on emission levels • Extra cash award for scrapping a polluting old vehicle at the same time • For the cleanest of all – those emitting less than 20 grams of carbon dioxide, currently mainly electric cars -- the state will pay out a special super-bonus of €6,300. Bonus system for new cars (New car taxation in France) Photo by Hickmann Vehicle-Related Taxes and Charges
- 34. Seite 34 Comments (Car taxation in France) • Emission limits used to be toughened every two years from 2008, by five grams each time, to encourage manufacturers to keep developing cleaner cars. • A company car tax is based on the respective CO2 emissions of each vehicle. Tax rates vary from €2 for each gram emitted between 50 and 100 g/km to €27 for each gram emitted above 250g/km • The average carbon dioxide emissions for new vehicles sold in France declined by 32 grams per kilometer between the end of 2007 and the end of 2013. • Emissions from vehicles purchased in France are now 9.4 grams under the European average, putting France a top European ranking. time. Vehicle Related Taxes and Charges Photo by Hickmann
- 35. Seite 35 Overview (Car taxation in France) Eco Penalty CO² Emission Rate (Grams/Km) Tax Amount From November 1st 2013 131 - 135 g CO2/km 150 € 136 - 140 g CO2/km 250 € 141 - 145 g CO2/km 500 € 146 - 150 g CO2/km 900 € 151 - 155 g CO2/km 1 600 € 156 - 175 g CO2/km 2 200 € 176 - 180 g CO2/km 3 000 € 181 - 185 g CO2/km 3 600 € 186 - 190 g CO2/km 4 000 € 191 - 200 g CO2/km 6 500 € 201 g CO2/km 8 000 Eco Bonus CO² Emission Rate (Grams/Km) Amount From November 1st 2013 0 – 20 g 6300 € (max. 27% of purchase price) 21 – 60 g 4000 € (max. 20% of purchase price) 61 – 90 g 150 € Source: http://www.french-property.com/ news/mo ney_f rance /car_ emission _tax_b onus/ Vehicle Related Taxes and Charges
- 36. Seite 36 Overview (cartaxation in France) VED CO2 2013/14 2013/14 2014/15 2014/15 2014/15 band Emissions first year standard first year standard standard (g/km) rate rate rate rate £ rate € A up to 100 0 0 0 0 B 101-110 0 £20 0 £20 25,34 € C 111-120 0 £30 0 £30 38,00 € D 121-130 0 £105 0 £110 139,35 € E 131-140 £125 £125 £130 £130 164,68 € F 141-150 £140 £140 £145 £145 183,69 € G 151-165 £175 £175 £180 £180 228,02 € H 166-175 £285 £200 £290 £205 259,69 € I 176-185 £335 £220 £345 £225 285,03 € J 186-200 £475 £260 £485 £265 335,70 € K 201-225 £620 £280 £635 £285 361,04 € L 226-255 £840 £475 £860 £485 614,40 € M over 255 £1065 £490 £1090 £500 633,40 €
- 37. Seite 37 Case Study:Motor Vehicle Taxation United Kingdom Vehicle Related Taxes and Charges
- 38. Seite 38 CO2 basedtaxation in UK since 2001 • Cars registered in UK after March 2001 are taxed based on CO2 emissions • Taxation according to tax band system Ø CO2 emissions are used to determine the road tax bands • The first year rate or 'showroom tax' applies to new car purchases only. Rate reverts to 'standard rate' in subsequent year • Official CO2 emissions levels are measured when the model is tested for 'type approval‘ • Cars registered before March 2001: Measure according to engine size of the vehicle
- 39. Seite 39 Case Study:Motor Vehicle Taxation- The Netherlands Vehicle Related Taxes and Charges
- 40. Seite 40 Dutch vehicletaxes Ø Lowest national average CO2 rating of new cars sold in 2013 Ø At 109.1 g/km, it was also the first and only country to achieve a national average below 110 g/km • Substantial initial registration taxes, heavily graduated to discourage the purchase of cars with high CO2 emissions • Company car taxes are also graduated according to CO2 emissions
- 41. Seite 41 Dutch vehicletaxes • One of the lowest shares of diesel vehicles among its new cars • By far the highest percentage of electric vehicles (mainly plug-in hybrids) among new car purchases at 5.3% of all sales • Market for fuel-efficient cars is also influenced by the very high rates of tax and duty on road fuels • For petrol, Dutch tax rate is highest found in the EU, with more than €1 of tax on every litre sold • Tax on diesel is lower, but still among the highest levels found in Europe Source: http://www.transportenvironment.org/sites/te/files/Netherlands_FINAL.pdf
- 42. Seite 42 Current regulationsregarding Dutch vehicle taxes • 2015 Tax Plan for BPN (luxury tax), MRB (road tax) and company car tax, implemented as of January 1st • New BPM tax tariff scale for vehicles with a CO2-emission • Only vehicles with a nil emission can get an exemption from BPM • For all other vehicles comes a BPM starting rate of € 175,- • Limits of current four tariff scales are tightened • Electric vehicles with a zero CO2-emission will have an exemption for BPM until 2018 • For diesel vehicles with an emission of <70 g/km, the diesel surcharge will be raised from €72,93 to €86,00 per g/km • The exemption of road usage tax for vehicles with a lower emission (until 50 g/km) will expire as of January 1st, 2016
- 43. Seite 43 Current regulationsregarding Dutch vehicle registration taxes The CO2 emission is higher than but not more than then deduct the value from column I from the CO2 emission of the car multiply that sum by the amount in column IV add to that sum the amount from column III I II III IV 0 grams/km 82 € 175 € 6 82 grams/km 110 € 667 € 69 110 grams/km 160 € 2,599 € 112 160 grams/km 180 € 8,199 € 217 180 grams/km - € 12,539 € 434 Step 2: Diesel surcharge €86 per gram CO2 emission above the 70 gr/km Example: Otto 100gr/km: 100-82=18 x69+667=1909 Euro Diesel 100gr/km: 100-82=18 x69+667+(30x86)=4489 Euro Step 1- Otto:
- 44. Seite 44 Proposed changesregarding Dutch vehicle taxes • 2016 “Alternative Company” Car Tax Plan, proposed to be implemented as of January 1st • Electric vehicles with a zero CO2-emission will remain to have an exemption for BPM • PHEV’s and REV’s will be charged for a half-tariff • The 4% and 7% tax charge category will disappear. Vehicles with an emission of 1 to 50 g/km will be qualified for the 15% category • Vehicles with an emission of 51 to 106 g/km will be qualified for the 21% category • The 25% category will apply for vehicles with an emission of 107 g/km or higher • These changes will not affect ongoing contracts entered into before January 1, 2016
- 45. Seite 45 Case Study:Motor Vehicle Taxation Germany Vehicle Related Taxes and Charges
- 46. Seite 46 Targets (Vehicletax Germany) • Lower emissions of local pollutants – now Euro 6 (from 09/2014) • Lower CO2 emissions • Market drives car manufacturers to offer “green“ cars • Promotes further Research and Development • Incentives for consumers to purchase “green” cars Figure by: GTZ Module 5a Air Quality Management Photo by: GTZ Module 4a Cleaner Fuels and Vehicle Technologies Vehicle Related Taxes and Charges
- 47. Seite 47 Changes (Vehicletax Germany) Old Tax • based on: • Engine displacement • Tax deduction for particularly ecological cars § New Tax § based on: » Engine displacement » CO2-emissions » Tax deduction for particularly ecological cars Engine displacement + (CO2-emission - exempt amounts) Petrol Engine 2€/100cm³ + ( 2€ per g/km - green/blue box) Diesel Engine 9,50€/100cm³ + ( 2€ per g/km - green/blue box) CO2 exempt amount (Diesel/Petrol): • Until 2011: 120 g/km • Until 2013; 110 g/km • From 2014: 95 g/km The New Tax in Detail CO2 exempt amount for Diesel Engine cars with Euro 6 Norm: • 150 € per year until 2013 Vehicle RelatedTaxes and Charges
- 48. Seite 48 Examples (Vehicletax Germany) BMW 118 Diesel • Engine Displacement: 1995 cm³ • Power: 105 kW • Fuel: Diesel • Consumption: 4,5 l • CO2-emission: 119 g/km • Euro5 2009: 308 € 2010: 190 € 2014: 238 € Porsche Cayenne S § Engine Displacement: 4806 cm³ § Power: 283 kW § Fuel SuperPlus § Consumption: 14,9 l § CO2-emission: 358 g/km § Euro4 2009: 324 € 2010: 574 € 2014: 624 € Toyota Yaris 1.0 § Engine Displacement: 998 cm³ § Power: 51 kW § Fuel: Super § Consumption: 5,0 l § CO2-emission: 118 g/km § Euro4 2009: 67 € 2010: 20 € 2014: 66 € Vehicle Related TaxesandCharges
- 49. Seite 49 Examples vehicletax comparison VW Golf VI 1,2 TSI • Engine Displacement: 1197 cm³ • Power: 63 kW • Fuel: normal petrol • Consumption: 5,5 l • CO2-emission:119 g/km • Euro5 Vehicle Related TaxesandCharges Germany 72 € Euro UK 38 € Euro France 150 € Euro
- 50. Seite 50 • Anemission zone: – is an area from which highly polluting motor vehicles are banned – these will be excluded from the city centre in three stages – to enter the Zone, vehicles must displaya permit disc (‘Vignette’) • As of January 2008: Berlin, Hannover,Cologne, meanwhile all major cities in Germany followed http://www.zeit.de/online/2009/22/auto-avus-1989 http://www.flickr.com/photos/vitaminf/3558748791 / Case Study: Particulate matter emission - Emission zones in Germany VehicleRelatedTaxesand Charges
- 51. Seite 51 Emission Zone:Berlin Stage 1 from 1.1.2008: Vehicles (lorries and passenger cars) must at least meet the requirements of Pollutant Class 2 of the recently adopted national vehicle marking scheme Therefore, vehicles with red, yellow and green stickers are allowed. Stage 2 from 1.1.2010: Only vehicles in Pollutant Class 4—thus, only vehicles with green stickers—may circulate within the zone. 2.2 Vehicle Related Taxes and Charges (9)
- 52. Seite 52 Parking Charges–sep Presentation Characteristics: • Strength in efficiency and equity • Steady revenue stream • Fostering of public transport use Parking fee for using public road space Photo by Carlos F. Pardo – Mexico-City 2007 Photo by Limanond – Singapore 2008 Local Instruments
- 53. Seite 53 8,7 6,3 6,0 4,8 4,8 3,8 3,8 3,8 3,8 3,7 1,9 1,9 1,7 1,7 1,5 1,5 1,5 1,3 1,3 1,3 1,1 0,9 0,8 0,6 0,6 2,9 2,0 1,5 2,4 3,2 2,7 2,5 3,4 2,0 1,5 2,0 1,9 3,2 0,8 1,3 2,2 0,7 1,3 1,0 1,3 0,6 0,9 1,3 0,9 0,7 0,4 1,8 1,7 0,6 0 1 2 3 4 5 6 7 8 9 10 London Amsterdam Tallinn Stockholm Kopenhagen Berlin Helsinki Oslo Paris Dublin Brussels Luxembourg Bern Prague Rome Vienna Riga Budapest Athens Ljubljana Vilnius Bratislava Madrid Sofia Warsaw Bucharest Lisbon Vaduz Valletta USDollars On-street parking/hour(CBD) Single bus ticket Parking Charges Comparison of parking fees in European cities (On-street per hour, CBD) with costs of single bus fare (Survey by GTZ, 2008,www.sutp.org)
- 54. Seite 54 Case Study– “license plate auction” in Shanghai, In Guanzhou, Singapore and….. Shanghai applies a bidding system for new car license plates Only a given number of vehicles can be registered per month Can be 4000--8000 Euro per new registration (In Beijing a max of 10000 new vehicles are allowed to be registered per month as of 2014) Photo by Rau Vehicle quotas Local Instruments
- 55. Seite 55 Revisedcar licenseplate issuing system in Shanghai -- Established first in Shanghai nearly 20 years ago, -- In Oct’2013, the authority released 10,000 plates for auction, 1,000 more than it did last month. -- After the price ceiling was abolished in October’13, the suppressed demand pushed the average cost of a plate to about 83,700 Yuan during October’13 auction, a surge of around 10,200 Yuan from September. -- In April’2013, the cost of buying a license plate reached a record price of more than 90,000 Yuan - three times as much as a cheap car – for example, a Zotye Z100 which comes in at RMB 24,000. -- However, the costs of Shanghai's car license plates continued to fall in the past six months. http://usa.chinadaily.com.cn/china/2013-10/21/content_17046774.htm
- 56. Seite 56 Vehicle LicenseQuota/ Auctioning • In Shanghai since 1998: • Limits the number of new vehicles: aprox. 8000 per month • Auction system, current price around $ 10,000 US • City Income $ 800 million US per year Chinese License Plates Net, 2009 Chinese License Plates Net, 2009. Statistics of license plate auction in Shanghai. http://www.paizhao.com.cn/html/paizhaoxinwen/2009/0712/262.html
- 57. Seite 57 Vehicle quotasinSingapore The Singapore Vehicle Quota System (VQS) • Each car registered requires a Certificate of Entitlement (valid 10 years, extendable), with the COE price determined by auction • Availablequota for new vehicles depends on the targeted growth rate in vehicle population • Growth rate target was 3% (prior to 2009), 1% (from 2012) and finally 0.5% in Feb 2013) Photos by Manfred Breithaupt and Carlos F. Pardo Local Instruments
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- 60. Seite 60 Insert congestionslide 8.00 am Beijing 9 November, 09.15 am
- 61. Seite 61 From ToYears 1949-1997 2300 1 Mil. 48 1997-2003 1 Mil. 2 Mil. 6 2003-2007 2 Mil. 3 Mil. 4 2007-2009 3 Mil. 4 Mil. 2.5 2010 4 Mil 4.8 Mil 1 Vehicle ownership Beijing • 800,000 new cars were registered in 2010 • That is 2191 new cars each day in 2010!
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- 63. Seite 63 Singapore -Certificates of Entitlement The Open Bidding System for Certificates of Entitlement (COE) allows to submit a bid for a COE, to monitor the current COE Price and to reserve the price of a bid from home, office or even from mobile phone. It provides real-time information during the bidding exercise so that one can check the current COE price and use it as a reference when submitting or revising a bid. One can submit his bid by indicating the maximum amount that he is willing to pay. If the bid has been successfully submitted, the bank will deduct the bid deposit, together with an administration fee of $2 from bank account. The COE Open Bidding System To find the user guide of the Open Bidding System you may visit: http://www.lta.gov.sg/ocoe/index.html Vehicle Related Taxes and Charges
- 64. Seite 64 Bidding Results,QuotaPremium and Prevailing Quota Premium in Singapore http://www.lta.gov.sg/content/dam/ltaweb/corp/PublicationsResearch/files/FactsandFigures/COE_Result_2010_2013.pdf
- 65. Seite 65 BMW 325IConvertible S$ Euro OMV 63061 33506 Duty 12612 6701 GST 5297 2814 ARF 63061 33506 COE 13389 7114 Total 157420 83614 Singapore – Cost of Vehicle Purchase Source: http://www.lta.gov.sg/motoring_matte rs/m otorin g_vo_ tax_pt e.ht m Photo: http://autoreview.belproject.com/ite m/305 Open Market Value (OMV) § OMV is assessed by the Customs & Excise Department, taking into account the purchase price, freight, insurance, handling and all other charges incidental to the sale and delivery of the car from country of manufacture to Singapore. Registration fees § Registration Fee (RF) $140 § Additional Registration Fee (ARF): 130% of OMV1 or 110% of OMV2 or 100% of OMV3 § Certificate of Entitlement (COE) Bid § Customs Duty 20% of OMV § Goods & Services Tax: 5% based on the CIF value (cost, insurance & freight) 1 For cars registered with COEs obtained from March 2002 to February 2004tender exercise. 2 For cars registered with COEs obtained from March 2004 to February 2008tender exercise. 3 For cars registered with COEs obtained from March 2008 tender exercise and onwards. Vehicle Related Taxes and Charges
- 66. Seite 66 Same vehicle- huge price differences Honda Civic Sedan VTi-S AT (1,8L AT) $ $$ $$$ $$$$ $$$$$ $$$$$$ $$$$$$$ USA: US$15,010 suggested starting price =S$ 21,300 Australia: AUD$23,790 =S$ 30,645 Thailand: THB768,000 =S$ 34,612 UK: £14,880 =S$ 41,945 Mumbai, India: INR1,218,700 =S$ 43,910 Malaysia: RM113,800 =S$ 49,908 Singapore: S$ 77,800 (including $8,000 COE) Source: Time Out Magazine Singapore,March 2008 Vehicle Related Taxes and Charges
- 67. Seite 67 Employer Contributions LocalInstruments Characteristics: • Good in sustainable transport, political acceptability and administrative ease • Strength in stability • Best possible use for local needs Financial Support of local public transport by employer’s and by businesses Types: • Direct tax to local authorities • Subsidy of the employee’s public transport fares Considerations: • Appropriate legislative framework is required Photo by Carlos F. Pardo Photo by Santhosh K. Kodukula
- 68. Seite 68 Case Study:The Congestion Charging in London Congestion Operating Hours: 7am – 6.30pm Monday to Friday, excluding Public Holidays and Non-charging days (e.g. Christmas Day and New Year’s Day) Where and when does it operate? Source: http://www.tfl.gov.uk/roadusers/congesti oncha rging/ 6718 .aspx Road Pricing/Congestion Charging
- 69. Seite 69 Congestion chargingin London • £10 a-day is the congestion charge for those driving in eight square miles of central London. • Drivers who paid the charge either by (cell-) phone (until 10 pm), via the internet or at shops and garages get registered in a database. How does it operate? • Anyone who fails to pay by midnight on the following charging day is fined £120. • 331 Camera sites monitor the traffic at both entry and exit points of the zone Video Camera Signs (Photo from Todd Litman 2004) Road Pricing/Congestion Charging
- 70. Seite 70 Impacts1 (CongestionCharging in London) Travel Speed Bicycle Use Bus Ridership Traffic + 20% (-20,000 veh/day) 37% (17 km/hr) - 14% 72% Congestion Delay 30% Road Pricing/Congestion Charging 1 in the monitoring period after implementation
- 71. Seite 71 Road accidents Bus Congestion Delay + 20-40%- Taxi Travel Cost 50% 16-19% Air Pollution Retail Activity 4.7% 70 less peryear Impacts1 (Congestion Charging in London) Road Pricing/Congestion Charging 1 in the monitoring period after implementation
- 72. Seite 72 Public Transport Ridership Peak Hour Congestion 22% 8% Traffic 25% 14% Air Pollution Retail Sales 10% „Trängselskatt“- Travel Impacts (Congestion Charge in Stockholm) Road Pricing/Congestion Charging
- 73. Seite 73 Early Singapore •Severe Traffic Congestion • Rising travel demand • Unreliable bus services Some of the SIA slides have been provided by Monhinder Singh, Director LTA Academy
- 74. Seite 74 65 kph45kph Increase ERP rate Decrease ERP rate Expressways 30 kph20 kph Increase ERP rate Decrease ERP rate Arterial Roads • ERP is a congestion management tool • Pay-as-you-use principle • Review speed range at 3-month interval, adjust ERP rates Electronic Road Pricing (ERP)
- 75. Seite 75 Case Study:Brazilian Vale-Transporte •In cities employers are required by law to buy and provide public transport tickets •Thereby the employers can withhold 6% of salaries to cover these costs Employer Contributions • Financial Support of local public transport by employer’s and by businesses • Stable way of funding • Best possible use for local needs • Examples: The Brazilian Vale Transporte, Versement Transport in France Local Instruments
- 76. Seite 76 Case Study:Versement Transport in France •The French Versement Transport (VT) is a tax levied on employees’ salaries to pay for improvements in public transport in the local area. In return, employees receive subsidies or free travel on public transport •Organisations with more than 9 employees in a district with more than 10,000 inhabitants are legally required to pay the VT. •The rate currently ranges from 0.55% to 1.72% of the total wages of each eligible company •Revenues have been used to fund small- and large-scale infrastructure projects across France •The VT has played a major part in funding the upgrading and expansion of the Paris Metro Public Transport in Ile-de-France Sources: http://www.stif.info/information-commu nication/ docu ments -langu es-et ran geres /english/ docu ments -anglais -124 1.ht ml http://www.indigoguide.com/france/pa ris-m etro. htm Local Instruments
- 77. Seite 77 Land Developmentand Land Value Taxes Local Instruments Financing measure where land owners directly benefiting from new public infrastructure has to pay for Types: • Land value tax • Developer contribution Characteristics: • Good contribution to sustainable transport • Tax payers are not penalised • Lack of increasing trade taxes • Businesses located near the new infrastructure can increase their trades and profits Considerations: • Create a legal framework that allows land-based taxes • Ensure communication to minimise perception of unfairness from those being taxed Photo by TransMilenio
- 78. Seite 78 Land Developmentand Value Taxes Land Value Tax: •Land owner is charged in relation to its benefits from new public transport infrastructure •Tax is based on the optimum permitted use of land and the current market price •Promotes better usage of owned land Case Study: Land value capturing in “Orestad” (District of Copenhagen) •Significantly growth of land value due to the construction of a new metro line •Land was sold to much higher prices than before •Revenues covered 45% of metro construction costs
- 79. Seite 79 Land Developmentand Value Taxes Municipal road owner Private land owner A. New urban roads: All roads of a new development area including sidewalks, etc. (based on existing development statute acc. to Federal Building Law) 10 % of construction costs 90 % of construction costs Subsequent maintenance of roads within new development area 100 % 0 % (Indirect contribution through land tax) B. Existing urban roads (Contribution Statute according to Provincial Law) 1. Maintenance of all roads 1.1 Winter service of all urban roads 100 % for road lanes 100 % for sidewalks 1.2 Repair to initial standard 100 % 0 % 1.3 New sidewalks and street lighting for existing roads 100 % 0 % 2. Rehabilitation/Upgrading 2.1 National and provincial roads 100 % by federal or provincial government 0 % 2.2 Urban main traffic roads including lighting and drains 90 % 10 % for traffic lanes (up to 8.50 m width) 50 % for sidewalks and parking lanes 2.3 Main residential development road (artery) incl. lighting and drains 70 % 30 % for traffic lanes (up to 6.50 m width) 50 % for sidewalks and parking lanes 2.4 Main industrial development roads 70 % 30 % for traffic lanes (up to 6.50 m width) 100 % for sidewalks and parking lanes 2.5 Main shopping streets 60 % 40 % for traffic lanes (up to 6.50 m width) 60 % for sidewalks and parking lanes 2.6 Residential roads 50 % 50 % for traffic lanes (up to 5.50 m width) 50 % for sidewalks and parking lanes 2.7 Traffic calming zones incl. parking and lighting 50 % 50 % for traffic lanes (up to 9.00 m width) 50 % for sidewalks and parking lanes 2.8 Commercial roads for industry 50 % 50 % for traffic lanes (up to 8.50 m width) 50 % for sidewalks and parking lanes 2.9 Sidewalks and parking lanes (independent or in combination with residential roads or shopping lanes) 40 % 60 % Case Study: Cost sharing between municipality and land owners in urban road financing in Germany Developer contribution: •Partnership agreement between developer /land owner and state •When granting permissions for land, developers need to ensure improvements in the existing transport infrastructure •Enhanced flexibility due to individual negotiated agreements Table by Federal Building Law (BAUGB)/Communal concession tax law (KAG) Adapted from Fink, M (2005)
- 80. Seite 80 Advertising Local Instruments Freespace of public transport infrastructure or vehicles is utilised for promotion of products Characteristics: • Strength in stability and political acceptability • Can be used to bridge shortfalls in financing • Little benefit towards sustainable transport Considerations: • Ensure that safety and visual obtrusion are not severely impacted Photo by Geraldine Holland
- 81. Seite 81 Advertising Case Study: Advertisingon bus stops in London •Contractual agreement between “Transport for London”(TfL) and “Clear Channel” (CC) •CC owns the rights to sell media space on half of TfL’s bus shelter portfolios •CC in return runs the routine maintenance an design of street furniture •All generated incomes are used for the London public transport network Photo by Geraldine Holland
- 82. Seite 82 Public PrivatePartnerships (PPP) Local Instruments • Utilisation of private sector know-how • Risks are allocated to the party best able to manage each particular risk • Enhanced budgetary predictability • Failure of delivering projects within budgets – bankruptcy – passing back of risks (see GTZ module) 3.9 Advertising • Stable way of funding • Instrument is highly accepted by politicians • Can be used to bridge shortfalls in financing • Little benefit towards sustainable transport
- 83. Seite 83 Development ofan Urban Transport Fund Combining the Financing Options “Urban transport is a complex system in which various components must work together effectively. This calls for an integrated financing structure at the urban level.” “Earmarking certain revenues may help to improve political acceptability and the financial stability of urban transport funds.” Concept of an urban transport fund Photo by Armin Wagner Photo by Varano
- 84. Seite 84 GTZ SUTPproject [email protected] [email protected] Thank you for your attention