Factsheet for measure
DE-2022-23/2231
–
Updated
– measures in Germany
Temporary reduction in fuel tax
Befristete Absenkung der Energiesteuer
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Country
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Germany
, applies nationwide
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Time period
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Temporary, 01 June 2022 – 31 August 2022
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Context
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COVID-19, War in Ukraine
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Type
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Legislations or other statutory regulations
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Category
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N/A
– Support for fuel expenses
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Author
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Birgit Kraemer (Hans Boeckler Foundation) and Eurofound
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Measure added
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10 May 2022 (updated 08 November 2023)
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Background information
Due to the increased energy prices in course of the Russian war of aggression against Ukraine, the citizens are particularly burdened by inflation driven by the high fuel prices. In order to cushion these burdens, the government decided in April 2022 that the energy tax rates for the fuels mainly used in road traffic will be reduced to the level of the minimum tax rates of the EU Energy Tax Directive (2003/96/EC).
Content of measure
According to the German government, the energy tax is a consumption tax which is usually borne in full by the end consumer. The temporary reduction in the tax rate should enable energy suppliers to pass on the tax reduction in full to end consumers. Employees and self-employed workers who rely on their cars as well as companies are supposed to profit from the measure.
The temporary reduction in energy tax to the European minimum has the following specific effects: The tax rate is reduced by 29.55 cents per litre for petrol, by 14.04 cents per litre for diesel fuel, for natural gas by approx. 6.16 cents per kg, and for liquid gas by approx. 12.66 cents per litre.
Updates
The following updates to this measure have been made after it came into effect.
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01 September 2022
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The energy tax rates were reduced for a limited period of three months from 1 June 2022 for the various fuels. Their temporary reduction ended on 31 August 2022.
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Use of measure
According to the German Bundestag, the tax cut on diesel, petrol, natural gas and LPG fuels and their tax equivalents will reduce tax revenues for the federal budget by €3.15 billion.
On the question of whether the tax breaks have been passed on to consumers, the German Federal Cartel Office (Bundeskartellamt) assumes on the basis of its calculations overall that a relatively high proportion of the discount was passed on in the first month after the introduction of the fuel tax rebate and that without the energy tax cut fuel prices in Germany in June would in all probability have been considerably higher.
Target groups
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Workers
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Businesses
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Citizens
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Applies to all workers
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Applies to all businesses
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Applies to all citizens
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Actors and funding
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Actors
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Funding
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National government
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National funds
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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No involvement
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No involvement
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Form
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Not applicable
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Not applicable
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Social partners' role in the
implementation, monitoring and assessment phase:
-
No involvement
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Main level of involvement: N/A
Involvement
No involvement.
Views and reactions
The German Trade Union Federation (DGB) criticise the measure for not not being targeted at employees with low income and warned that the measure is at risk of simply enlarging the profit margins for big fuel companies (DGB 2022).
While the Federation of German Employers (BDA) has not particularly commented the measure, the Federation of German Industries (BDI) criticise that it was questionable whether the reduction in energy tax on fuels for three months would make a lasting contribution to cushioning the burden of the extreme price increases. The expansion of existing relief instruments such as the distance allowance, housing allowance and heating cost subsidies would have a more targeted support effect (BDI 2022).
Sources
