Taxes, VAT or tolls: French people’s cars bring a fortune to the State
France is one of the European countries that taxes its motorists the most, with a tax bill estimated at nearly a quarter of their budget.
This is a painful figure. According to the Automobile Club Association, reported by the newspaper Le Parisien, nearly a quarter of the French budget devoted to their cars goes directly to the state coffers. Compared to the number of vehicles on the road in the country, this is an average of 2,619 euros per car in recent years.
According to the European Automobile Manufacturers’ Association, this is estimated to bring in the government coffers nearly 83.9 billion euros in 2019.
It is clear: in Europe, only Austria (2,930 euros) and Belgium (3,536 euros) tax motorists more. Well ahead of Sweden (1,663 euros) or the United Kingdom (1,716 euros).
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France is even the European country with the most taxes on petrol, with VAT or the Internal Consumption Tax on Energy Products (TICPE), which brought the State nearly 42.8 billion euros in 2019.
“The income from the TICPE, which taxes highly polluting petroleum and energy products, is used to finance part of the welfare help to the most vulnerable or the departmental roads. The aim, over time, is to push the French towards hybrid or electric vehicles,” explains a senior official of the Ministry of Finance in the columns of Le Parisien.
Next year, these taxes will provide financial stimulus to the automotive sector which has been badly affected by the economic crisis.
Highly lucrative taxes and road tolls
Just like fuel, they tax almost everything in your vehicle.
VAT (on purchases, repairs or equipment) brought in 18.5 billion euros to the State last year. Excluding fuel, these are by far the most lucrative taxes.
Road tolls (€12.6 billion) and insurance taxes (€5.1 billion) are also significant financial windfalls.
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Much more, for example, than traffic fines, which reportedly brought in “only” 1.7 billion euros. “With less than 1 billion euros for speed cameras, I’m not sure that the government’s primary aim is to make revenue. They are essential tools to promote road safety and tackle air pollution,” said a lawmaker from the government’s party.
The bad news for motorists is that these taxes should not be lowered in the coming years. In fact, there has been not a single signal from the government to suggest this.
Meanwhile, the Council of Taxation recommended “resuming a carbon tax trajectory” last year. This could cause an increase in fuel tax. If this proposal is implemented in the coming months, motorists will probably grind their teeth…