News item | 01-07-2022 | 17:15
More future-proof motor vehicle tax replaces paying for car ownership
From 2030, car owners will no longer pay for car ownership, but for car use. The cabinet wants to reform the current motor vehicle tax into a kilometer-dependent tax for passenger cars and delivery vans. In the new system, motorists pay for the actual use of the road and no longer pay a fixed amount for owning a car. It does not matter where and when these kilometers were driven. The Council of Ministers has agreed to send the House of Representatives a letter with the first elaboration of these plans from the Coalition Agreement.
With the current motor vehicle tax (MRB) a fixed amount is paid per car per year. A motorist who drives few kilometers now pays just as much mrb as a motorist who drives a lot. By transforming the current system from a tax on property to a tax on use, the burden of car mobility will be distributed more evenly and equitably. The total costs remain the same. Drivers who drive little will pay less than drivers who drive a lot. The system of payment according to use also makes an important contribution to the two objectives included in the Coalition Agreement: maintaining tax revenues and reducing CO2 emissions in mobility.
Minister Harbers of Infrastructure and Water Management: “In everyday life you pay for what you use; for example your groceries and your clothes. Motorists will soon no longer pay for owning a car, but for using it. This system is fairer, because the burden is divided according to use. Drivers who drive little pay less than drivers who drive a lot. They put less strain on the road network and the environment than motorists who drive more kilometers.”
State Secretary Van Rij of Finance: “Motorists are increasingly opting for an electric car. And that’s a good thing, because as a cabinet we encourage this because of the climate. It does mean, however, that government revenues from car taxes will decline over time, in particular due to declining revenues from fuel excise duties. This year we are raising approximately €14 billion, of which more than €4 billion through motor vehicle tax. Maintaining this government revenue is one of the reasons for introducing a new and future-proof system. Soon all motorists, including electric drivers, will pay tax again depending on how much they use the road. In this way, public facilities can also be paid for in the future, such as healthcare, education and (maintenance of) the roads.”
Pay according to use
The government intends to introduce the system of payment according to use by 2030 by making the rate of the current MRB for all passenger cars and delivery vans kilometer-dependent, without making any distinction based on time and place in the kilometer rate. So it doesn’t matter where or when someone is driving. Mileage driven abroad also counts. To levy the tax, it is only necessary to register how many kilometers a car drives annually. The government does not need to know where and when these kilometers were driven and this guarantees privacy.
Conscious car use
With the introduction of payment according to use, motorists are encouraged to use their car more consciously. In this way, cars also contribute to reducing CO2 emissions. A system of payment according to use therefore has a positive effect on improving air quality and is expected to reduce congestion on the road. These effects are under further investigation.
The new system will be introduced budget neutrally, at the level of car taxes from 2025. Tax losses after 2030, caused by further growth in the number of electric vehicles after 2030, will be compensated by increasing the kilometer rate annually. This will ensure that government revenues remain stable in the future.
Consequences for existing toll routes
It was agreed in the Coalition Agreement that the toll routes still existing at that time will be canceled simultaneously with the reform of the MRB. Temporary tolls are currently being prepared for two routes that have yet to be completed: the Blankenburg Connection and the ViA15. The government is currently mapping out the consequences of the abolition of tolls on these routes. A toll is now also levied for the Westerscheldetunnel and the Kiltunnel, both managed by local authorities.
further trajectory
The principle of paying according to use for car mobility is not new. There have been several plans to introduce such a system. The government wants to learn as much as possible from previous, comparable processes and to meet the concerns about complexity, privacy, affordability and user-friendliness. Discussions are therefore being held with interest groups and local authorities. Various studies are also being conducted into further details, such as the consequences of the system for different households.
A number of important choices still have to be made. For example, about the way in which the number of kilometers driven is registered and what it means if the rate is made dependent on the weight and fuel type of the car, as in the current mrb. This is currently under further investigation.
The aim is to adopt the legislation during this cabinet term and to make other preparations that are necessary to be able to introduce the new system. Further investigations will be carried out in the near future. The aim is to start an internet consultation of the draft legislation by mid-2023 at the latest.