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News
EU news
Passenger cars
The European Commission has launched a consultation on passenger car taxation. An initial communication, announced in September 2002, focused on two main areas.
News
EU news
Passenger cars
The European Commission has launched a consultation on passenger car taxation. An initial communication, announced in September 2002, focused on two main areas.
* In relation to the internal market, it noted that considerable tax obstacles and distortions to free movement of passenger cars exist as a result of current passenger car taxation systems and identified registration taxes as the biggest problem across the European Union. It, therefore, recommended their gradual reduction, preferably abolition, to be replaced by annual road taxes and fuel taxes.
* In relation to Community policy environmental objectives and sustainability, it recommended that the taxation of new passenger cars be more directly related to their carbon dioxide emissions.
Examination of the various options available to meet the objectives stated in the communication has been considered, and they have been short-listed to four:
* the do-nothing option;
* retaining existing taxation systems, but introducing a refund system to avoid double taxation problems when cars transfer to another Member State;
* the gradual phasing out of registration tax, with a refund system to apply in the meantime, and the introduction of a new tax structure linked to carbon dioxide emissions; and
* similar to previous option, but rather than a phasing out of registration tax, merely reducing it to a level that does not exceed ten per cent of the pre-tax price of the car.
Initial views from the industry and consumer associations support the third option. However, the Commission is launching a wide consultation to collect feedback from interested parties, with a view to making a legislative proposal in the autumn. In order to assist in the evaluation of comments, a questionnaire has been prepared which can be completed on-line at http://europa.eu.int/yourvoice/forms/dispatch.jsp?form=1610&mode=TEST.
Written responses may also be submitted, using the questionnaire format, to the following address: Passenger car taxation consultation, European Commission, Directorate General Taxation and Customs Union, VAT and other turnover taxes, B-1049, Brussels, Belgium.
The closing date for comments is 10 September 2004.
(http://europa.eu.int/comm/taxation_customs/taxation/consultations/car_taxation_en.ht)
