The German cabinet has agreed to raise taxes German tax laws on high-emission vehicles from the year 2021 onward. If you’re a driver in Germany here’s what you need to know:
Motor vehicle tax reforms
As part of the effort for Germany to curb carbon emissions into the air to aid in the fight for climate, high emission cars will be taxed higher.
This is an effort to reduce the buying of cars that destroy the ozone layer by more carbon emissions especially due to sitting in traffic for long hours.
Vehicle taxes in Germany are already calculated on the basic of engine size and CO2 emission but the new pricing system is set to increase the financial burden on owners of high emission vehicles urging them to switch to cars that emit less carbon and pay less taxes. Low emission vehicles with might receive lower taxes in future.
The new law will begin imposing surcharges once a vehicle exceeds average emissions of 95 grams of CO2 per kilometre (a target which even the most climate-friendly cars cannot currently match), starting at 2 euros per additional gram.
Read more information on German Laws and legislation here: Legal News and Guides – Germany
The surcharge then increases incrementally, through six stages, up to 4 euros per gram from 196 grams per kilometre.
Passenger cars with emissions of less than 95 grams of CO2 per kilometre will be incentivised with an annual tax bonus of 30 euros, for a maximum of five years.
Additionally, new electric cars will be exempt from the vehicle tax until the end of 2030 (this exemption was previously only valid until the end of 2025).
Who will end up paying more?
The new calculation solely depends on new registrants so for those planning on purchasing a car from 20121 onward.
What does this mean for me?
The law that decided the fate of high emission cars has not been passed by Bundestag but there are high chances it might not face opposition as the grand coalition’s large majority means it is most likely to become law.