Kilometer Tax – Netherlands

Date: 9 Jan 2009 | posted in: environment | 0 Facebooktwitterredditmail

Update – January 2005: The Dutch government believes that an alternative method of paying for road use is necessary to improve the reliability, reduce journey times and thus strengthen the economy. The government is therefore making all the necessary preparations to pave the way for the introduction of road pricing by a next government, without already committing itself to a specific type of road pricing.

Toachieve this consensus, the Paying for Mobility Platform was set up. This Platform is to come up with a broadly-supported road pricing proposal in the early spring of 2005. This proposal, the outcomes of the consultation with other authorities, the results of the interdepartmental policy study on “Gebruiksvergoedingen Goederenvervoer” (Road Pricing for the Road Haulage Sector) and the reactions to consultation will be incorporated in PKB-3 (Core Planning Decision) of the Mobility Policy Document.

Although not yet a formal rule, the Dutch government’s efforts and investigation to dramatically change its transportation funding scheme is a good example of what a Government can and should do. A potentially revolutionary, good idea was formulated, the idea was deemed interesting by the government, a plan to implement the idea was developed, and the goverment has committed the resources to put the good idea into practice. The plan recently approved by the Dutch government calls for a projected 10 million cars, trucks and motorcycles to be equipped with wireless tracking devices by 2006. The idea is to charge drivers on a per kilometer basis and revamp the way up to $6 billion in road and vehicle taxes are collected.

Usingan idea from entrepreneur, Roel Pieper, the Dutch government will replace current transportation taxes Dutch drivers currently pay with a system that charges drivers based on how much they drive. Currently, Dutch drivers pay a 25% sales tax on new cars, a vehicle tax based on the price and weight of the car, plus a road tax based on the weight of the vehicle and the type of fuel used. With technology known as MobiMiles, all of these taxes will be replaced by a system that uses global satellite positioning and other wireless technologies to charge drivers on a pay-as-you-go basis. Initially, drivers will be charged a flat price per kilometer but later fees may depend on road categories and time of day.

At the end of January 2002, the Dutch Second Chamber of Parliament indicated that it will support plans for a variable road pricing system and the institution of a per-kilometer tax beginning in 2004. Variable road pricing and the per-kilometer tax enjoy broad support in the legislative branch because the scheme is expected to help the Netherlands meet its Kyoto targets while providing funds for road maintenance and reducing traffic congestion.

Similarinitiatives in other european countries are under development. The Swiss government is placing wireless tracking devices in 60,000 trucks as part of a new road usage fee system that will bring in $424 million annually. Germany plans to put devices in trucks in 2003, with the new road usage tax expected to affect some 1.2 million vehicles. The Dutch are the first, though, to consider a plan that includes all vehicles.

Thebiggest drawback and concerns about these types of proposals is the issue of privacy. The Dutch Government’s latest report on their proposal indicates that the privacy of drivers cannot be compromised and it is committed to developing a kilometer tax system that keeps the exact location of vehicles secret. Roel Pieper proposes a digital map of the Dutch motorway system divided into up to five colors, each one representing a price category. Charges will be tallied in the car, with the device issuing a bill at regular intervals. Because only the category and not the actual location of the road is recorded, supporters of the system claim that it will not infringe on drivers’privacy.

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