“Millions of foreign vehicles criss-cross Germany every year, one of the few countries on mainland Europe not to have widespread tolls on its roads. Neighbouring countries such as Austria, Switzerland and France all charge motorway users, triggering resentment from drivers in the German regions that border them,” says the Financial Times.
Germany responded by placing its own tolls. Germany also let owners of German registered vehicles deduct those tolls from their annual vehicle tax bill.
“Unfair Discrimination” whines the EU nannycrats to the European Court of Justice.
Brussels is taking Berlin to court over Germany’s controversial plan to charge foreign drivers for using its roads, bringing a simmering two-year row into its final stages.
While the charges of up to €130 per year will apply to all users, German registered vehicles are able to deduct the charges from their annual vehicle tax bill — a benefit that the commission says is “discriminatory”.
The proposed fees for short-term access to Germany meanwhile are “disproportionately high”, according to the European Commission, which made the decision to bring Germany before the European Court of Justice on Thursday.
Germany had braced itself for a long legal fight, with the country’s transport minister stating in April that he was prepared to take the disagreement all the way to the EU’s top court. If the court agrees with the commission, Germany would face having to rewrite its law — and face fines if it does not.
Alexander Dobrindt, the German transport minister, said the toll “conforms to European law, and the European Court will confirm that”. He has argued that there are tolls in other European countries and money raised through the levy will go towards Germany’s transport infrastructure.
“Germany doesn’t need any toll,” said Oliver Krischer, a leading Green MP. “It doesn’t yield anything, is highly bureaucratic and contrary to European law. It also has no incentive effect in terms of the environment.”
The European Commission is also examining a similar scheme in the UK, in which British truck drivers can deduct a levy from their domestic vehicle tax, while foreign drivers cannot. This investigation is still ongoing.
“We are concerned that the German system discriminates against drivers from other member states,” said a spokesperson for the European Commission. “It will lead to a situation where German users — and only Germany users — are de facto exempted. When the single market rights of citizens are being threatened, this is where the commission will act.”
Imagine Wisconsin or Indiana taking Illinois to court over tolls or gasoline taxes.
Illinois and Indiana have tolls, Wisconsin doesn’t. Residents in Illinois and Indiana opt for a device that automatically pay the tolls. If you don’t have the device, you pay a higher rate. Is that discrimination against Wisconsin?
Nearly every state has lower sales taxes then Illinois. Is that unfair discrimination?
This kind of bureaucratic nonsense is yet another reason, the UK does not need the EU.
For more on this topic, please see Gang of 27 Hits UK with Impossible Demands: EU Seeks “Inferior” Deal for UK, Spain Wants Gibraltar.
Mike “Mish” Shedlock
The UK just got yet another reason to Brexit a.s.a.p.
(not that they needed more reasons)
You would expect the EC to persuade France, etc., to get rid of their tolls instead of targeting Germany, which is reacting. Many of the tolls are highway robbery. If you cross Austria or Switzerland on vacation, you need a vignette that covers your return trip, which means you pay a significant portion of what would be the annual cost. Crossing Slovenia to Croatia is the most expensive, covering about 100km of freeway, the rest is two-lane highway. The costs are completely disproportionate arm twisting of tourists, and in the end countries such as Germany, the Netherlands, Belgium, Denmark, etc., will be subject to political pressure to take revenge.
It would be a lot saner to have some kind of revenue sharing to even out possible disadvantages for disproportionately transited countries. The worst is tolls like in the States, where they have 100 people sitting in the summer sun at 100° collecting quarters, costing everybody time, in many instances the cause of traffic jams that increase transit time in hours instead of minutes. Collecting the tolls destroys half the revenue, and it is silly to view these as “user fees” — that’s simply a subterfuge by poorly integrated governments (cities with traffic but no tax-base) not taking responsibility for funding (or not) investments in economically viable infrastructure.
“The worst is tolls like in the States, where they have 100 people sitting in the summer sun at 100° collecting quarters,”
It’s been a long, long time since I have seen them collect quarters. Those toll roads give me a good excuse to take the back roads, which I prefer anyway.
Illinois, and most states, has had wireless I-passes for about 25 years. It saves a fortune in labor, reduces pollution, and greatly speeds your trip. France still did not have them when we were there last year, and some of their toll collection machines did not work….Europe is falling behind…
I am old enough to remember when Illinois first built toll roads. They were very controversial, since everyone thought the fuel tax should pay for roads. The deal was they sold bonds to pay for construction, and “promised” that when the tolls had paid off the bonds, the roads would no longer have tolls. Most people do not even know that. It’s just another unkept political promise (sometimes called a lie), and the politicians always count on the voters to forget about such things. The bonds were paid off decades ago. Taxes, tolls, fees; seems there is never enough of it.
But don’t work for foreigners; I’ve tried in NewJersey
In New York/New Jersey area (2015) various roads (incl Garden State Pkwy) and bridges still have them, although they also have EZ-pass for locals.
tolls Are good
tolls on The Salzburg-Villach-Laibach-Fiume Route Are fabulous and should Be doubled
Tolls?
Oops! I thought you said toilets. 🤔
Reminded me of when former Merril Lynch CEO John Thain splurged some $35,000 on his toilet enroute to piling up over $1M in expenses to remodel his wife five. That took place just prior to Bank of America being forced to accept the Federal Reserve induced cram down of Merril Lynch and all it’s ridiculously leveraged up “assets”.
The following is a list of the items in his suite:
Area Rug $87,784
Mahogany Pedestal Table $25,713
19th Century Credenza $68,179
Pendant Light Furniture $19,751
4 Pairs of Curtains $28,091
Pair of Guest Chairs $87,784
George IV Chair $18,468
6 Wall Sconces $2,741
Parchment Waste Can $1,405
Roman Shade Fabric $10,967
Roman Shades $7,315
Coffee Table $5,852
Commode on Legs $35,115
Thain also hired Smith, whose celebrity client list include Steven Spielberg, Michelle Pfeiffer, Cindy Crawford and Sir Evelyn de Rothschild, to design his Manhattan apartment at 740 Park Avenue, and his 14 bedroom home in Rye, NY.
I initially thought Thain’s “commode” meant toilet until reading someone’s astute observation that commode more commonly refers to a piece of furniture than a toilet.
Another excellent comment
So, “Unfair” or “Discriminatory” means something is keeping keeping the EU from squeezing every last penny of tax revenue from you?
The German taxpayers already paid to build the road in the first place, and they can legally charge any toll they wish. I would make Draghi pay property taxes on the ECB building and charge EU officials quadruple road taxes just to put them in their place.
What is the EU going to do about it? Return Germany’s money and kick them out of the bankruptcy club?
Good Idea! Germany also should charge every Eurocrat a Merkel Tax, just for the privilege of having Germany in the EU!
Merkel’s days as Chancellor are numbered regardless of this latest EU nonsense. Her tone deaf response to German voters on immigration has put the CDU (her political party) on the defensive. The CDU doesn’t have many other palatable options, but they will have to come up with someone who can balance German needs with demands from unelected eurocrats (lower case on purpose, since “EU” is neither a sovereign nor a place). If the CDU can’t come up with a “moderate”, odds are the AfP will (probably in a coalition, but the CDU still loses).
I don’t know that sparking a trade war within europe would be a great idea — but I would propose it just to put the arrogant eurocrats in their place.
And while they debate the “legality” in a frivolous court with no means of enforcement, Germany should exercise its sovereign right to negotiate a trade agreement with the UK and common wealth countries (perhaps pull in historical German economic bloc countries such as Netherlands and Poland).
Either the insubordinate losers in Brussels learn their place, or Germany should replace them with a sustainable free trade area (what the EU was supposed to be before they got such big heads and big liquor tabs).
Germany, UK, and Netherlands (hopefully adding UK commonwealth countries and Poland in short order) would be a much stronger trading group. It would get more favorable treatment outside of western europe (the Russians love natgas customers who actually pay in something other than IOUs). It would have a stable currency. Switzerland might want to join too, but they would grant favorable terms even if they remained independent.
If the bankrupt club med countries don’t want to act like grown-ups, let them go play in a separate sandbox by themselves.
Why Germany should grovel before a bunch of unelected eurocrats is beyond me. The eu court of selective enforcement has no sovereignty, and no means of enforcement.
And to be blunt, the EU needs Germany and the UK a lot more than Germany / UK needs the drunks in Brussels. If Merkel is too spineless to say so, I worry the AfP will be far less charitable.
Excellently stated
Mish
I think the Krauts should pay the fines. Just print up the requisite number of 500 Euro notes and truck them to the Commissions office in Brussels.
PS — while I don’t believe Deutche bank is any worse off than other ECB victims (its not better off either)… its precarious status adds even more pressure for Merkel to show some backbone against the tyranny of eurocrats.
Maybe the Bundestag should cut off funding for Brussels and use that money to pay German depositors (most of whom are savers) in DB a market interest rate instead of the central planning rate that Draghi made up?
And file charges against Draghi (and the ECB) for stealing from savers. Use the word “theft”, as in a felony charge. Drag Mario Draghi out of ECB headquarters in handcuffs; and remind the scribes at the Financial Times that the eu (lower case) is not a sovereign nation, and neither is their central bank.
Germany holds all the cards, even if Merkel is too spineless to use them. German voters know this, even before the AfP starts agitating.
Germany, like the UK, would be much better off without Brussels. And I repeat that a trade group anchored with Germany and the UK would be far superior to the trade group the eu was originally supposed to be, before the unelected bureaucrats got so full of themselves.
Another fight among the EU brats…. Imagine that!
The Germans made their decision without approval from the EU, and the EU did not like that. It’s about power.
I do enjoy reading this blog and the comments section from here in the UK.
One thing though, the Common Market/EEC/EU and it’s early predecessors was always intended by it’s originators and those that have followed as a mechanism to build a united states of Europe under a supranational government by way of a ratchet effect. It’s simply that the politicians – particularly those in the UK – have lied about it. They chunter on about trade and and ignore the politics.
Happily the Brexit vote caught them out and they are mostly flapping around in a panic, wondering what to do next- Although Mrs May seems so far to be pretty determined to make it work.
Anyone who wishes to understand the detail of the origins of the EC and Britain’s entry into the Common Market should read ‘The Great Deception’ by Richard North and Christopher Booker.(with whom I have absolutely no connection).
That is the “intention” of the EC that YOU wanted. You arrogantly assume everyone agrees with you, without a shred of supporting evidence outside your own clique.
What you arrogantly refuse to admit is that Europe as a whole did not have a single vision, beyond a trade block. SOME people agree with you. Others think it should be a trade block. Still others think it was a common currency.
Europe did not (and still does not) have a single vision. You are wrong to assume that you (or your book author) somehow speak for everyone else. You don’t.
There is zero difference to your forced government and every other fascist regime that has run Europe into the ground
Freddie old chap,
I’m not sure I follow you entirely.
No doubt there are differing visions out there but I really do recommend you read the book and/or do your own detailed research.
Note I referred in my post above to the originators and those that followed. Start with Salter and Jean Monnet, then Spinnelli(Ventotene Manifesto),Schumann,Delors etc.
Lisbon Treaty, Common Currency, 5 Presidents Report.
If there wasn’t an integrationist plan this would be totally at odds with the gradual move from the European Coal and Steel Community, through to the EU with freedom of movement, a common currency,European Court, Commission, harmonisation of policies and laws and the ECJ. Not forgetting the putative army.
Regards
p.s. I just googled The ECSC and as a start this might be a useful primer:
https://en.wikipedia.org/wiki/European_Coal_and_Steel_Community
No one cares about your silly book reference, nor your selected quotes. Your little clique has its opinions, but so do dozens of other groups who believe the EU was created for reasons that contradict what your clique thinks. There are more opinions about “the purpose” of the EU than there are EU member countries — yours is but one of many opinions.
Judging by their actions (as opposed to your stupid book), not one EU member country is willing to subjugate their government or taxes to Brussels. Actions speak louder than drunk EU presidents, and your book reference is merely the opinion of one author.
For you to arrogantly assume that everyone conquers with your propaganda is just rancid arrogance,.
No country in Europe has shut down its national legislature to make room for your fantasy ideas. Not one has subjugated their tax collection to Brussels. Not even the “big government” advocates in Paris.
If there were any merit to your OPINION on the EU’s purpose, why aren’t any of the member countries putting their money / legislative power where your opinion is? Obviously, they don’t agree with you either.
Besides the UK’s exit, many countries are considering an EU exit — because everyone is fed up of arrogant people like you telling us what our opinion should be.
Freddie old chap,
you ranting on is all very well but whilst your posts allude to the true reasons why the EU was set up you do not explicitly state them.
Perhaps you could enlighten me and any other readers who may be interested.
As to Governments not being prepared to accept the supranational Government of the EU, all members demonstrably do so by the acceptance and operation of common rules, currency and policies under EU Competancies.
I do not say that tensions -e.g. between the Commission and the Council of Ministers and member states – do not exist. This is clearly so.However, the gradual process of integration is not yet complete and complicated by world realities and the number of relatively new member states, particularly those east and south east of Germany.
Perhaps the latest ‘drang nach osten’ wasn’t a good idea after all.
Regards
DV
p.s. I am thoroughly aware of the shortcomings of Wikipedia. However given your apparent reluctance to look at the history of ‘le projet’ I thought a nice simple primer might encourage further study.
PS — wikipedia is written by extreme left leaning authors centered around San Fransisco California. It is censored by editors chosen by wikipedia in San Fransisco.
Universities in the US (despite their sympathetic political leanings) do not allow US students to use wikipedia as a reference. Its bias is widely acknowledged both inside and outside academia.
The issue is that german tolls roads apply different prices for Germans and non-Germans.
French highway are pay-per-use, with an average price, and collect tolls on french, foreigners in France and transiters through France the same way.
One can debate the ethics of such a tarif scheme, but the EU rules forbid this kind of internal tolls, whereas this is partly tolerated between states in the US.
Note that this kind of stuff could still be implemented with different wording.
You seem to have forgotten that taxpayers paid for these roads, and taxpayers pay the public employees that maintain them.
Why should German taxpayers pay twice?
Make the French drivers pay auto taxes, income taxes and so forth to Berlin — just like German taxpayers already do. Otherwise make them pay tolls.
Either way you want to tax it — Brussels has no say in the matter.
I am French and Germany should have legal rights how to manage nationally its fiscal system.
If set in place, I would just avoid the German roads, making the country lose potential income…
Market always balance after all, meet the demand and don’t beat it.
Mish,
your analogy is inaccurate. The more accurate analogy would be that Indiana or Illinois imposes tolls only over the residents of other states and not their own residents. Now, is that discrimination?
Wisconsin has higher rates for in state and out of state admission to parks and fishing licenses. I think it is very bad policy actually. Tourism brings lots of money to the state. Is it illegal discrimination? No
It depends how you define “discrimination” in legal terms. Under the EU Treaty it is understood as different treatment by Member States of own citizens in comparison to the citizens of other EU Member States.
In this case we have better treatment of German citizens than the citizens of other EU Member States. It is a violation of the EU Treaty. The EU commission has to bring this case to the European Court of Justice. Their duty is to protect that the EU Treaty is obeyed.