Decarbonisation and the Pricing of Road Transport
Policies to mitigate climate change require a fundamental change to taxation in the transport sector. The shift to electric vehicles and continuing improvements in the fuel efficiency of internal combustion engine vehicles will extinguish revenues from fuel taxes. This report assesses the options for reforming vehicle and road-use taxes. It identifies potential packages of taxes and charges that could generate revenue more efficiently and maintain and enhance incentives for the transition to a sustainable transport system.
Policy Insights
- Reform fuel taxes
- Supplement fuel taxes with distance-based charges
- Consider opt-in arrangements for the introduction of new distance-based charges
- Introduce congestion charges where required
- Consider earmarking congestion charging revenues for improving public transport and active mobility
- Set the level of road-user charges to meet sustainable transport objectives
- Make introducing differentiated distance-based charges a policy priority
- Reform incentives for the uptake of electric vehicles to better align with policy goals
| Date of Publication | 21 June 2023 |
|---|---|
| Number of Pages | 60 |
| OECD iLibrary Link | https://doi.org/10.1787/54809337-en |
| Document |
 decarbonisation-pricing-road-transport.pdf |
| Publication Type | Roundtable Report |
| Publisher | OECD/ITF |