Autobahn Fees

The End of the Road Toll

toll station - rio antirio patra greece
Achtung, toll! Who must pay what, and where?
  • Why it matters

    Why it matters

    If Germany introduces a road toll it will gain necessary funding for infrastructure – but the new tax should be fairly applied.

  • Facts

    Facts

    • Germany is among the few remaining countries in Europe which does not yet have a road toll.
    • The coalition government and the E.U. have long debated the planned road toll and whether it is legal for the tax to be focused on drivers from abroad.
    • The Transport Ministry estimates the new tax disc system will generate €500 million, or $545 million, but experts have questioned this figure.
  • Audio

    Audio

  • Pdf

 

Under threat of lawsuit from Brussels, the German transport minister said today he will delay by a year his plan to impose nationwide tolls on non-German motorists using the country’s highways.

The announcement this morning by Alexander Dobrindt, a Bavarian member of Chancellor Angela Merkel’s ruling coalition, could spell the beginning of a long, quiet death for the plan, which has raised objections for targeting only non-German motorists.

Mr. Dobrindt announced the delay just ahead of a European Commission announcement that it would take Germany to court over tolls it had planned to begin imposing next year. European regulators say the German plan, which would partially offset the cost of the tolls to German taxpayers through reduced annual motor vehicle taxes, violates the E.U. charter.

“A toll system can only be compliant with European law if it respects the fundamental Treaty principle of non-discrimination. We have serious doubts that this is the case in the final text of the relevant German laws,” the E.U. transport commissioner, Violeta Bulc, said in a statement.

The E.U. suit, called an infringement proceeding in Brussels parlance, could end up before the European Court of Justice in Luxembourg.

Mr. Dobrindt said the German government is determined to proceed with its plans to introduce Germany’s first autobahn road toll on passenger motorists, but there is now a risk the controversial plan will be canceled.

The German government has been at loggerheads with the European Commission and European Parliament over the toll plan, which  it claims will help offset the cost of building and maintaining Germany’s network of highways that play a crucial role in connecting countries in Europe.

The heart of E.U. opposition comes from the fact that the toll appears to be paid only by foreigners. All drivers will have to pay the toll in the form of an annual pass, but while German drivers will be able to deduct that amount from the vehicle taxes they pay each year, foreign drivers will not.

Michael Cramer, chair of the European Parliament’s Transport and Tourism Committee and a Green party member, told Handelsblatt Global Edition he believed the plan was dead.

“Mr. Dobrindt said the plan is delayed but it will be canceled,” he said.

“No one is discriminated against. All car owners pay the same levy. We can do what we want with car tax after that. That is a matter of national sovereignty.”

Alexander Dobrindt, Transport minister

Mr. Dobrindt has admitted that toll will now not be introduced in 2016 as originally planned.

In an interview with Bild newspaper published Thursday, Mr. Dobrindt said the European Commission’s decision to begin infringement proceedings would “slow down the implementation of infrastructure.”

Mr. Dobrindt insisted that the toll was compliant with E.U. regulations and said the government will continue preparing for the road toll while it waits for the court decision. “The road toll will happen,” he said.

“We are prepared to act constitutionally and will wait for a court decision on the matter,” he said.

“The German government and parliament have created E.U.-compliant legislation,” he added. “It is about fairness on our roads. All vehicle owners who use our roads in future will contribute to some of the costs of building this infrastructure. Most of our neighboring countries have toll roads. And it’s all about adding value for motorists. Every euro that we take from the tolls will be invested directly back into the roads.”

Mr. Dobrindt said the exemption for German drivers was to make sure they did not pay twice for the cost of the roads, first through a vehicle tax and then through the tolls.

“No one is discriminated against. All car owners pay the same levy. We can do what we want with the car tax after that. That is a matter of national sovereignty,” he said. “Germany has a balanced budget. We can cut the car tax for motorists any time we like. That is our decision and nothing to do with Brussels,” he said.

But Mr. Cramer, the European parliamentarian, said the planned toll was “populism against foreigners in the E.U.”

He pointed out that Germany has tried to raise a similar levy before in 1990 and 2004 , suggesting that all truck drivers pay a toll and that German truck owners can offset that against vehicle tax. The European Commission struck down the plans both times.

“The European Court will decide, as it did 10 years and 20 years ago that it is wrong,” Mr. Cramer said.

“A toll system can only be compliant with European law if it respects the fundamental principle of non-discrimination. We have serious doubts that this is the case.”

Violeta Bulc, E.U. commissioner for transport

The tolls on foreign drivers – which Germany’s own motorist association, ADAC, and the European Union have warned is illegal – is a concession to Bavaria, whose Christian Social Union party is a key bloc in Ms. Merkel’s ruling coalition.

Bavaria in southern Germany borders on Austria, the Czech Republic and Switzerland, and is likely to benefit most from the additional income from imposing tolls on drivers from abroad.

Austria has already said it will file a separate complaint against Germany at the European Court of Justice, and has the backing of E.U. transport commissioner Violeta Bulc. European Commission President Jean-Claude Juncker has also said he is not sure if the toll is legal.

In response to the criticism, Mr. Dobrindt slammed Austria for having double standards.

“Austria treats motorists unequally. In the Katschberg tunnel, Austrian drivers get special concessions that save them some €100 per year compared to foreign drivers,” he said.

Many German states had pushed to exempt border regions, fearing the new toll would dissuade foreigners from spending money across the border in their regions. Those concerns were rejected as it was decided the tax would apply across all of Germany.

Twenty other European countries already charge auto tolls, including France, Greece, Italy, Britain and Spain, but all of them apply their tolls equally to national and foreign drivers. Germany has been a popular transit country thanks to its free-of-charge roads.

Germany spends €3 billion a year on highway repairs, of which €2 billion come from taxpayer funds and €1 billion from a toll on trucks that was enacted in 1995.

Under Mr. Dobrindt’s plan, drivers will pay €5, €10 or €15 for a 10-day pass. A two-month pass will cost €16, €22 or €30, depending on emissions and car size. A full-year permit would not exceed €130, or $141.

Ana Mingo Jaramillo, a consultant on E.U. transport policy, said the fate of Germany’s roads, particularly the motorways that cross through Bavaria, are a European matter.

“Bavaria is a key transit crossroads in the heart of Europe,” she said.  “What if other states follow the German example and introduce levies? Transit through Europe by car could grow more costly. Less affordability within the E.U. could undermine the principle of free movement.”

Under the German government’s plans, 65 percent of the toll proceeds will be used to upgrade the road network. Of what remains, 70 percent will be used to build new highways and improve major four-lane interstate highways.

The remainder would be used for regional needs such as roads circumventing towns.

 

Meera Selva is an editor with Handelsblatt Global Edition and has covered political and security issues in Britain, Africa and Berlin. To contact the author: selva@handelsblatt.com

We hope you enjoyed this article

Make sure to sign up for our free newsletters too!