VMT Fee May Replace Car Taxes In Netherlands

Imagine this: Replacing the sales tax on purchasing a new vehicle and annual, 'fixed' fees with a VMT fee based on size, weight, and CO2 emissions of the vehicle. This is the plan of the Dutch government to reduce congestion and greenhouse gases.

Will a new, variable vehicle-miles-traveled fee using GPS that may, in fact be revenue-neutral, reduce congestion and carbon dioxide emissions? The Dutch cabinet thinks it will, but the Parliament hasn't ruled on it yet.

"The Dutch government said Friday it wants to introduce a "green" road tax by the kilometre from 2012 aimed at cutting carbon dioxide emissions by 10 percent and halving congestion.

"Each vehicle will be equipped with a GPS device that tracks how many kilometres are driven and when and where. This data will be then be sent to a collection agency that will send out the bill," the transport ministry said in a statement.

Ownership and sales taxes, about a quarter of the cost of a new car, will be scrapped and replaced by the "price per kilometre" system aimed at cutting the Netherlands' carbon dioxide emissions by 10 percent."

Thanks to Ed Braddy

Full Story: Netherlands to levy 'green' road tax by the kilometre



I like this, BUT

I like this, but I DON'T like the GPS device. Couldn't it be replaced with more of a "meter reading" approach, where you go in ?

I see the GPS device being a major problem with getting this implemented in the US, due to either actual or percieved privacy concerns.

GPS is no doubt valuable in terms of how knowing WHERE someone drove might help allocate their tax moneys to fix roads. But I don't see this getting past tinfoil hatters here in the States.

Advantage Of A GPS Device

The advantage of a GPS device is that it could also include anti-congestion pricing. Higher prices for more congested roads could virtually eliminate congestion. I hope the Netherlands tries this.

You are right that it is difficult to implement in the US because of privacy concerns, but there are possible ways around this. Eg, the Brookings Institution has proposed GPS-based pricing that reports how many miles people have travelled on roads of different classes without reporting where people have traveled. Roads would be divided into classes based on congestion, and people would be charged higher prices for each mile travelled on more congested roads, without any reporting of where people traveled. As further protection, the data could also be destroyed after billing is complete.

Charles Siegel

Deleted duplicate comment.

Deleted duplicate comment.

What about congestion

The only problem with this type of measurement is that on the long run, origins and destinies will tend to get shorter as people want to travel less, allocating near destinies. This formula doesn't account for the increased production of GHG due to reductions of speed, thus higher congestion, which can vary up to 50%. MPG is a linear function CO2 produced, through fuel consumption. But MPG varies according to speed, see city mpg vs hwy mpg variations on any car.

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