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Gas Taxes in Europe

By: Elke Asen

To facilitate and foster cross-border trade and to prevent significant competitive distortions, the European Union requires EU countries to levy a minimum excise duty of €0.36 per liter (US $1.61 per gallon) on gas. As today’s map shows, only Bulgaria sticks to the minimum rate, while all other EU countries opt to levy higher excise duties on gas.

gas taxes Europe gas Europe diesel, petroleum, crude oil

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The Netherlands has the highest gas taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. in the European Union, at €0.79 per liter ($3.53 per gallon). Italy is second, at €0.73 per liter ($3.26 per gallon), followed by Finland and Greece, both at €0.70 per liter ($3.12 per gallon).

You’ll find the lowest gas taxA gas tax is commonly used to describe the variety of taxes levied on gasoline at both the federal and state levels, to provide funds for highway repair and maintenance, as well as for other government infrastructure projects. These taxes are levied in a few ways, including per-gallon excise taxes, excise taxes imposed on wholesalers, and general sales taxes that apply to the purchase of gasoline. in Bulgaria, at €0.36 per liter ($1.61 per gallon), followed by Hungary (€0.38 per liter or $1.70 per gallon), and Poland (€0.39 per liter or $1.74 per gallon).

As between one-third and one-half of new passenger vehicles are diesel vehicles in the European Union, many European consumers face excise duties on diesel instead of gas. The EU sets a slightly lower minimum excise duty of €0.33 per liter ($1.47 per gallon) on diesel.

Twenty-six out of 28 EU countries levy a lower excise duty on diesel than on gas. Only the United Kingdom and Belgium levy the same rate on the two fuel types. The average excise duty on gas is €0.56 per liter ($2.48 per gallon) in the European Union, while it is €0.45 per liter ($2.00 per gallon) on diesel.

The United Kingdom levies the highest excise duty on diesel, at €0.65 per liter ($2.90 per gallon), followed by Italy (€0.62 per liter or $2.77 per gallon) and Belgium (€0.60 per liter or $2.68 per gallon).

The countries with the lowest excise duties on diesel are Bulgaria, at €0.33 per liter (or $1.47 per gallon), and Poland and Luxembourg, both at €0.34 per liter (or $1.52 per gallon).

All EU countries also levy a value-added tax (VAT)A Value-Added Tax (VAT) is a consumption tax assessed on the value added in each production stage of a good or service. Every business along the value chain receives a tax credit for the VAT already paid. The end consumer does not, making it a tax on final consumption. on gas and diesel. The excise amounts shown in the map above relate only to excise taxAn excise tax is a tax imposed on a specific good or activity. Excise taxes are commonly levied on cigarettes, alcoholic beverages, soda, gasoline, insurance premiums, amusement activities, and betting, and typically make up a relatively small and volatile portion of state and local and, to a lesser extent, federal tax collections. es and do not include the VAT, which is charged on the sales value of gas and diesel.

Excise Duties on Gas and Diesel in the European Union, as of January 2019

Source: European Commission, “Excise Duty Tables: Part II Energy products and Electricity,” https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/taxation/excise_duties/energy_products/rates/excise_duties-part_ii_energy_products_en.pdf.

Notes:
The excise duties apply to petroleum and diesel with a sulphur content of <10 mg/kg, RON 95 (petroleum), bioethanol content, and, if applicable, include carbon taxes and surcharges.
The excise duties were converted into USD using the average 2018 USD-EUR exchange rate (0.848); see IRS, “Yearly Average Currency Exchange Rates,” https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates.
*Hungary’s excise duty increases to EUR 0.40 per liter for gas and EUR 0.38 per liter for diesel if the world market price of crude oil is at or below $50 USD/barrel.

  Gas Tax Diesel Tax
  Per Liter in EUR Per Gallon in USD Rank Per Liter in EUR Per Gallon in USD Rank
Austria (AT) € 0.48 $2.14 20 € 0.40 $1.79 19
Belgium (BE) € 0.60 $2.68 11 € 0.60 $2.68 3
Bulgaria (BG) € 0.36 $1.61 28 € 0.33 $1.47 28
Croatia (HR) € 0.52 $2.32 16 € 0.41 $1.83 16
Cyprus (CY) € 0.43 $1.92 24 € 0.40 $1.79 19
Czech Republic (CZ) € 0.50 $2.23 18 € 0.42 $1.87 15
Denmark (DK) € 0.63 $2.81 10 € 0.43 $1.92 14
Estonia (EE) € 0.56 $2.50 13 € 0.49 $2.19 7
Finland (FI) € 0.70 $3.12 3 € 0.53 $2.37 5
France (FR) € 0.68 $3.04 5 € 0.59 $2.63 4
Germany (DE) € 0.65 $2.90 6 € 0.47 $2.10 10
Greece (GR) € 0.70 $3.12 3 € 0.41 $1.83 16
Hungary (HU)* € 0.38 $1.70 27 € 0.35 $1.56 24
Ireland (IE) € 0.59 $2.63 12 € 0.48 $2.14 9
Italy (IT) € 0.73 $3.26 2 € 0.62 $2.77 2
Latvia (LV) € 0.48 $2.14 20 € 0.37 $1.65 22
Lithuania (LT) € 0.43 $1.92 24 € 0.35 $1.56 24
Luxembourg (LU) € 0.46 $2.05 22 € 0.34 $1.52 26
Malta (MT) € 0.55 $2.46 14 € 0.47 $2.10 10
Netherlands (NL) € 0.79 $3.53 1 € 0.50 $2.23 6
Poland (PL) € 0.39 $1.74 26 € 0.34 $1.52 26
Portugal (PT) € 0.64 $2.86 9 € 0.49 $2.19 7
Romania (RO) € 0.44 $1.96 23 € 0.41 $1.83 16
Slovakia (SK) € 0.51 $2.28 17 € 0.37 $1.65 22
Slovenia (SI) € 0.55 $2.46 14 € 0.47 $2.10 10
Spain (ES) € 0.50 $2.23 18 € 0.38 $1.70 21
Sweden (SE) € 0.65 $2.90 6 € 0.46 $2.05 13
United Kingdom (GB) € 0.65 $2.90 6 € 0.65 $2.90 1
Average € 0.56 $2.48   € 0.45 $2.00  

Note: This is part of a map series in which we examine excise taxes in Europe.

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