The words of Ukrainian President Zelensky in his speech to the House of Representatives were clear: ‘Be prepared to stop the energy from Russia.’ When Russia invaded his country, The Hague politically spoke of solidarity with Ukraine. Now that petrol prices are rising, little of that sentiment is left and the government is rushing to compensate with a cut in excise duties. The target? Low-income groups meet the tax increase. However, the cabinet is doing so with a measure that is not only ineffective, but also sponsors Putin’s war machine in Ukraine.
Because of the decision to lower the excise duties on petrol as of 1 April, the Netherlands is indirectly financing Putin’s war in Ukraine. That is why the JOVD and the Young Democrats urgently call on the government to reverse this decision. The majority of Russian oil and gas exports end up in the European Union. Since the outbreak of the war, the EU has collectively purchased more than EUR 20 billion worth of Russian fossil resources, thereby contributing to Putin’s war.
Russian fuel drip
Within the EU, the Netherlands is the second largest importer of Russian oil. Currently, the Netherlands is effectively on an infusion of Russian fuel and to break free, the Dutch must consume less petrol. While Ukraine is fighting for its freedom, the Netherlands is supplying the Russian tanks with fuel, so to speak.
Rising energy prices are also increasing uncertainty. The Average National Recommended Price is currently just under 2.50 euros, which puts Putin in the pocket of the Dutchman. The government’s ‘solution’ to lower excise duties has been taken far too quickly. After all, the knot was cut just before the municipal elections, so that the voter did not go to the polling booths with a sour taste about the petrol prices. This accusation lies not only with the cabinet, but also with an opportunist opposition that was just as happy to abuse rising petrol prices as an election point.
Targeted Compensation
If the government wants to offer people a real solution, two things have to happen: targeted compensation and accelerating our energy transition. For the former, a temporary reduction in fuel excise duties is simply not effective. The revenues from excise duties amount to billions of euros per year. This money should not be used as general government revenue, but should go towards policies to reduce CO2to reduce emissions. And in this time of high inflation it should certainly be used to compensate the low income groups.
In addition, the central government can use this money to accelerate the energy transition, to become energy independent from Russia as soon as possible and to guarantee its green objectives. The government must continue to focus on installing as many solar panels, wind farms and nuclear power plants as possible. In addition, more gas can be obtained from the Netherlands than in Groningen alone: the North Sea offers a large gas supply that is still underexploited and which could be an important puzzle piece in the solution. Since this will take time, the Netherlands will also have to focus on international cooperation and a European energy market.
Make train cheaper
The past pandemic has taught us to work from home more. Reducing public transport rates would also lead to less cost pressure. The problem is not that the middle class pays extra for a tank of petrol, but that low incomes are sinking through the bottom of their livelihoods: the government must do something about that. A simple reduction in excise duty is not the right measure for this.
Several studies have shown that especially the groups with more wealth benefit from the excise tax reduction. Although the tax authorities are currently unable to distinguish between wealthy and less wealthy households, this does not mean that the whole of the Netherlands should now be given an extra pocket money.
The Netherlands is now at a moral crossroads. We can choose for ourselves and view the war in Ukraine as a far-from-home show. We can also choose to consider ourselves poor with honor than rich with disgrace, to focus on the energy transition and – by putting all our shoulders to the wheel – to really help low incomes.
Daphne Lodder is chairman of the JOVD. Joris Hetterscheid is chairman of the Young Democrats.