Following a vote in the European Parliament on developing a more harmonised and CO2 based taxation of cars in the EU at the beginning of September, ACEA, the European Automobile Manufacturers Association, shows clear support for the Commission’s proposal.

Recently ACEA was threatened with the introduction of mandatory targets because the current climate change voluntary agreement will probably not meet the standard agreed of 140 grams CO2/kilometer in 2010. ACEA says it believes in linking car taxation directly to CO2 emissions.

A similar scheme for the taxation of low- carbon fuels would increase also increase the overall environmental effectiveness of a CO2 tax. CO2 taxes for cars and fuels would reduce car related CO2 emissions substantially. According to ACEA, of basic importance for a scheme would be that the taxation should be technology neutral and linearly related to CO2 emissions.

The transition to the new tax regime should also be budget neutral and the market should not be distorted. Ivan Hodac, Secretary General of ACEA, stated that such a regime “will create the necessary demand for CO2 efficient solutions that are already offered to the market or waiting to be introduced. CO2 based taxation should be the main element of a multi-stakeholder EU strategy to reduce car related CO2 emissions.”