Progress in charge structure and internalisation policies

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Topics: Transport ,

Assessment made on 01 Sep 2004

Note: new version is available!

Jan 12, 2011 - Internalisation of external costs (TERM 026) - Assessment published Jan 2011

Generic metadata

Classification

Transport (Primary theme)

Tags:

TERM | TERM026

DPSIR: Response

Identification

Indicator codes

TERM 026

Geographical coverage:

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Contents

Policy issue: Recover the full costs of transport including externalities from users

Key messages

Progress in restructuring transport charges towards better internalisation of external costs is slow. Important developments are the introduction of urban charging schemes and distance related charging schemes on motorways. However, eight policy schemes aimed at reducing air pollution have recently been abolished. Charge differentiation focuses mainly on air pollution in the road sector and noise in the aviation sector. Few measures have been taken to internalise costs of COB2B emissions, rail and road noise and congestion.

Figures

Progress in charge structures and internalisation policies

Key assessment

Given the importance of differentiation of transport charges and taxes on the basis of environmental impact, the indicator gives a qualitative overview of the adaptation of price structures in transport towards environmental characteristics. The fact sheet on fuel prices and taxes (TERM 2003 22 EU - Progress in charges) sketches the development of use-dependent transport charge levels.

Due to incomplete information, the required level of transport taxes and charges under a fair pricing regime is hard to establish. Moreover, it depends on local and temporal circumstances. Some differentiation of taxes charged is currently done, concentrating mainly on air pollution in the road sector, tax reductions for fuel efficient and hybrid passenger cars, noise in the aviation sector and scarcity in rail infrastructure charges. Very few measures have yet been taken to internalise costs of congestion on the road, rail and road noise (some aviation and rail charges, and some urban parking fees are exceptions as regards congestion) and climate change and air pollution cost in aviation. In most urban areas, the internalisation of external costs is still far from complete.