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Traffic Jams and Taxation

Traffic Jams and Taxation

Belgium is the highest congested country of Europe according to the annual Inrix Europe Scorecard, a world leader in real-time traffic information.. Last year, we lost an average of 51 hours stuck in traffic, compared with 58 hours in 2013. The country leads this ranking before their neighbouring countries like Germany and the Netherlands.

The cost of traffic jams is so high that even the companies would like to see some sort of taxation to get a more efficient traffic flow. Febiac (La fédération Belge de l’Industrie de l’Automobile et du Cycle) is also an advocate of traffic taxation. “Road pricing or zone taxation , will surely be one of the main subjects in the next regional elections” predicts Brussels State Secretary Bruno De Lille ( Green Party) . His cabinet is studying whether road pricing or a zone charge is the best solution.

The OECD is in favour of an electronic system of road pricing to combat congestion. Belgium has “one of the worst congestion states observed in the OECD area “, says the organization in its latest economic report on Belgium.

There consist different opinions of political parties around the nature of the tax. The best known is the congestion charge as in London, but that is the least popular. Which consists in a daily amount (£11.50) levied on vehicles entering a zone between 07:00 and 18:00, Monday to Friday.

A variant of this taxation are the road pricing schemes, which will only have to be paid by commuters, which is applied in Stockholm. All of these systems use cameras to read license plates.

On the other electronic method of road pricing, there is a much broader consensus. There is a device in the car, the OBU ( on-board unit ) , which is equipped with GPS and allows the government to charge a variable fee depending on the time , day and road used .

In my opinion, the on-board unit is the most honest way to charge road users. By using this system, companies that manage their own car fleet for employees could adjust the employee’s work schedule to get a cheaper tax arrangement with the government. That’s why I prefer a more variable tax instead of a fixed fee, it leaves the car driver more freedom. The chauffeur can choose for public transport if the variable tax is high at that specific moment or he / she could just use the car on a less congested moment.

To conclude, there is still a lot of research to do to make a good and cost-efficient decision. A lot of debates between different political parties will follow, but they all agree on one point of view. The Belgian government needs to take measures in order to ensure the Belgian companies that their employees are on time for their work as the neighbouring countries face fewer difficulties.

This blogpost was written by Laurens Maximus (2327), Exchange student at Nova SBE.

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Author: studentnovasbe

Master student in Nova Sbe

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