The Dutch are well known for Delft pottery, wooden shoes, legalized prostitution, and windmills. Perhaps not surprisingly, many of those things haven’t caught on in all areas of the world (oh c’mon, tell me that you have a pair of wooden shoes in your closet).
I have a feeling that list of things that aren’t spreading like wildfire is about to grow…
Effective in 2012, Dutch drivers will be monitored by GPS and will pay taxes on a per-kilometers-driven basis. For the average passenger car, the rate will be about € 0.03 per kilometer (or roughly $.07 US per mile). Drivers of trucks, commercial vehicles, and less fuel-efficient cars will pay more. Public transit and cabs will be exempt from the tax.
Additionally, the cost will increase for drivers at peak times.
How will it work? GPS will track the time, hour, and place each car moves and send the information to a billing agency. The billing agency will deduct the taxes directly from drivers’ accounts.
If it works as anticipated, the Dutch government estimates that traffic will drop by 15% – and rush hour traffic will drop by 50%. Minister of Transportation Camiel Eurlings believes that carbon emissions will be cut in half.
Interestingly, the law will abolish current road taxes and sales taxes for cars. The final numbers should work out so that 6 out of 10 drivers are better off under the new scheme and reportedly, tax revenue will remain the same.
According to the German newspaper, Deutsche Welle, the tax will increase every year until 2018.
The news has stirred interest in nearby Germany with top German automotive expert Ferdinand Dudenhoeffer saying that Germany should “take the progressive (Dutch) model as an example.” Interesting for sure. But there’s one or two (or three or four or five) obstacles: namely Audi, BMW, Mercedes, Porsche, and Volkswagen. Long considered an automaker’s paradise, Germany tends to be known for heavier, more luxurious, power cars – not so much the cheaper, smaller more efficient cars encouraged under the Dutch scheme. With that in mind, in a tough economy, Germany is highly unlikely to adopt a policy that might negatively affect the car industry any time soon.
But that doesn’t mean that it’s not on the radar of other countries. Singapore already utilizes Electronic Road Pricing, a pay-per-use principle, and in the UK, there is a congestion charge for some drivers in the designated Congestion Charge Zone (CCZ). Which makes you wonder… Which country, if any, will be next?
Seems like an overly complicated system. If the goal is to reduce fuel consumption and reduce carbon emissions then just tax fuel (which I’m sure they already do). The Dutch system will (presumably) also reduce congestion, but raise the gas tax enough and it will have that effect, too.
I’d be in favor of a $1/gal gas tax if all the money went to fund alternative energy research. I’d rather pay now and funnel it to the universities than pay it out during the next oil crisis when it ends up in the pocket of Exxon or Saudi Arabia. We need a sustainable solution.
Oh, and I did have a pair of wooden shoes when I was a kid — a gift from a family friend who traveled to Holland. They are really uncomfortable. It must have been desperate times to have considered whittling logs to cover your feet.
Okay, it’s a “cool” idea, I suppose, for a small homogeneous country that’s already quirky.
Here in the US I would violently oppose an idea like this. It’s not the different tax, it’s the GPS. I don’t want ANYBODY keeping a record of where and when I drive. Especially not in this country, and especially not any government. I don’t have a nav system in my car, and if I had a GM car I’d have the OnStar disabled.
This approach is already being studied right here in the USA at the University of Iowa Public Policy Center under a $16.5 million Federal grant – see http://www.roaduserstudy.org/