This report is part of the eighth annual report T&E has published on progress in reducing CO2 emissions and improving the fuel efficiency of cars. This document focuses on average new car emissions in different Member States and highlights the effectiveness (or otherwise) of their different taxation policies in encouraging the purchase of lower carbon cars. In 2013, the top six best performing countries all achieved annual emissions reductions of new cars of more than 5% (Netherlands, Greece, Slovenia, France, Finland and Bulgaria). In contrast the laggards, including Sweden and Poland, achieved less than 2.5% improvement in average CO₂ emissions from 2012.
The principal responsibility to reduce CO₂ in line with the Regulation falls upon the carmakers. Each carmaker has a target for the CO2 emissions of the new cars it sells in 2015 and 2020/1. However, there is much that Member States can do to help (or hinder) progress through the policies that they adopt nationally. Substantial differences in the rate of progress of companies are mirrored by the Member States, principally because of differences in the ways cars are taxed across the EU. While some countries have made conspicuous efforts to improve the fuel economy of their new cars, others have done very little to support the aims of the cars and CO₂ legislation.
In 2013, the top six best performing countries all achieved annual emissions reductions of new cars of more than 5% (Netherlands, Greece, Slovenia, France, Finland and Bulgaria). In contrast the laggards, including Sweden and Poland, achieved less than 2.5% improvement in average CO₂ emissions from 2012. Countries with low average emissions typically have initial registration taxes (purchase taxes) and company car taxes that are steeply differentiated by CO₂. Annual circulation taxes are a modest driver of fuel efficiency even if they are graduated according to CO2 emissions, and high fuel taxes alone have a limited influence on the efficiency of the cars being bought – but do impact on the overall level of car use and fuel consumption.
Low levels of diesel tax encourage higher proportions of diesel car sales and more vehicle use. Fuel should be taxed on the basis of its energy content with similar rates of excise duty applied to gasoline and diesel fuels to avoid market distortions leading to dieselisation.
