Current car tax regulations are rattling on all sides as automakers are increasingly focusing on greening through electric models. The proposal to further adjust the bpm rates next year, because it is assumed in The Hague that petrol cars will become increasingly economical, has raised eyebrows among industry organizations Bovag and RAI Association.
According to the industry, the Ministry of Finance assumed for years that fuel cars would become a few percent more efficient every year and adjusted the bpm rates accordingly. This is to be assured of tax revenues. In reality, with fuel engines, almost the maximum achievable has already been achieved when it comes to driving more economically. Many car manufacturers therefore prefer to focus on the development of electric models rather than making fuel engines more efficient.
In concrete terms, this means, according to the Bovag, that a new Volkswagen Polo is no more economical than the model that came on the market four years ago. But the so-called greening had to be paid for. In addition, electric models are exempt from bpm. All in all, according to the organizations, due to incorrect assumptions, around 1.5 billion euros extra bpm has been raised since 2017. The purchase of a car was up to 10 percent higher due to the bpm adjustments.
Considerably more expensive
For next year, a proposal has been made to set the ‘fictitious greening’, the compensation for the more efficient cars on paper, at 4.2 percent. That means that the disk limits for the bpm be lowered. This is now being discussed in the Lower House. According to Bovag and RAI Vereniging it is better to set this percentage to zero. The only thing that will be achieved with the measure is that the purchase of cars will become more expensive, the complainants say. The Bovag and RAI Association predict that the bpm for the ten most sold fuel cars will increase by 18 to 32 percent.
The bpm and the current car tax system in the Netherlands have been messing around for some time. Every year, various car taxes provide the treasury with around 20 billion euros. On the other hand, 5 billion to 6 billion euros will flow back to infrastructure projects, according to the Bovag. State Secretary Hans Vijlbrief of Finance already indicated that he wanted to take a closer look at the entire bpm system next year. According to the Bovag, the current system is doomed. More attention should be paid to using rather than owning a car. The VVD, for example, wants to have owners of electric cars pay per kilometer driven in the long term, making the road to the widespread introduction of the kilometer charge seem passable in the future.