Vehicle tax brings in €440 billion across Europe

Last year, vehicle taxation brought in just over €440 billion across 14 major markets in Europe, ACEA says. That’s 3% more in 2018. To put that figure in context: it’s two and a half times the entire budget for the European Union. 

And that just goes to show how important the automotive industry is – not just for the overall economy, but also as a source of fiscal revenue for governments, says ACEA, the Association of European Car Manufacturers.

Big Five
The figure covers Europe’s Big Five markets (Germany, the UK, France, Spain and Italy), plus a string of smaller, but vital countries in terms of automotive fleet size in Europe’s north (Finland, Sweden and Denmark), west (the Netherlands, Belgium, Ireland and Austria) and south (Portugal and Greece). 

Unsurprisingly, Germany – the continent’s largest economy, most populous country, and biggest car market – rakes in the most in vehicle taxes: (€93.4 billion), followed by the other members of the Big Five: France (€83.9 billion), Italy (€76.3 billion), the UK (€54.1 billion) and Spain (€30 billion). 

Double digits
Three of the smaller countries still takes in double-digit billions in car tax: the Netherlands (€21.5 billion), Belgium (€20.7 billion) and Austria (€14.3 billion). 

Among the single-digit countries, the dichotomy between Sweden and Portugal is particularly stark. Both countries have a population of about 10 million each, but Sweden’s GDP is double that of Portugal; yet Sweden’s automotive tax take is significantly smaller than Portugal’s (€8.1 vs. €9.6 billion).

In all countries but one, fuel tax is the major component of revenue. In Denmark, it’s sales and registration taxes.