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Database of national-level policy measures

Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure DE-2022-23/2231 – measures in Germany

Temporary reduction in fuel tax

Befristete Absenkung der Energiesteuer

Country Germany , applies nationwide
Time period Temporary, 01 June 2022 – 31 August 2022
Context COVID-19, War in Ukraine
Type Legislations or other statutory regulations
Category Responses to inflation
– Support for fuel expenses
Author Birgit Kraemer (Hans Boeckler Foundation) and Eurofound
Measure added 10 May 2022 (updated 20 June 2022)

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.

Use of measure

No data available yet.

Target groups

Workers Businesses Citizens
Applies to all workers Applies to all businesses Applies to all citizens

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role No involvement No involvement
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • 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

Citation

Eurofound (2022), Temporary reduction in fuel tax, measure DE-2022-23/2231 (measures in Germany), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/DE-2022-23_2231.html

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