HGV (Heavy Goods Vehicle) toll: Innovative, ecological and fair

Toll enforcement (Source: Federal Government)

Since the beginning of 2005, a successful scheme has been in operation in Germany to charge heavy goods vehicles a distance-based charge for the use of motorways.

In 2005, toll revenues totalled around 2.86 billion euros. In 2006, revenues increased by around 8 percent to around 3.08 billion euros and in 2007 by around 9 percent to around 3.36 billion euros. In 2008, a total of around 3.46 billion euros were generated. This is an increase of more than 3 percent compared with the preceding year. In 2009, the tolling scheme generated revenues of around 4.40 billion euros. The increase over the preceding year was due to the toll adjustment of 1 January 2009. In 2010, as a result of the weakening economy, there was only a slight increase in toll revenues of just under 2 percent to 4.48 billion euros compared with the preceding year.

This means that HGV tolls are making a sizeable contribution to the funding of transport infrastructure in Germany. Most of the investment goes to the federal trunk roads sector.

HGV toll: Innovative, ecological and fair

By using a charging approach that is based more on the “user pays” principle, the HGV tolling scheme ensures the maintenance and upgrading of the motorway network. Since the start of tolling on 1 January 2005, German and foreign HGVs with a maximum permissible weight of 12 tonnes or more have been subject to the compulsory toll on German motorways. With the introduction of the toll, the Federal Republic of Germany has implemented a system change - from tax-based funding to user-based funding of motorway construction.

With the HGV toll, the Federal Government is pursuing the following objectives:

• infrastructure charging based on the "user pays" principle: HGV, in particular, impose high motorway maintenance and operation costs. A "40-tonner" places around 60,000 times more strain on the road surface than a passenger car;
• securing funding for the further upgrading and maintenance of the transport infrastructure;
• creating an incentive for an ecologically desirable shift towards rail and waterway-based freight transport and more efficient use of HGVs;
• promoting innovative technologies.

By varying toll rates according to the emissions the vehicles cause, the HGV tolling scheme provides an incentive for hauliers to use low-emission vehicles. The wider range of toll rates applicable from 1 January 2009 increases the environmental regulatory impact of the HGV tolling scheme.

HGV tolling scheme - compensation for road hauliers

In conjunction with the introduction of the HGV tolling scheme, the German Bundesrat and Bundestag as well as the Federal Government agreed in May 2003 that, given the conditions of competition in the European road haulage sector, compensation measures totalling 600 million euros per year must be ensured in order to ease the burden on the German road haulage industry.

It was agreed to implement the following measures:

• the so-called toll rebate scheme (setting-off fuel tax already paid in Germany against toll due);
• reduction of the motor vehicle tax to the permissible minimum according to EU legislation; and
• a so-called Innovation Programme to provide incentives to purchase cleaner heavy goods vehicles.

Initially, the toll rebate scheme was meant to be the principal compensation measure. However, in its review of the toll rebate system in early 2006, the European Commission ruled out this measure as being incompatible with the European state aid rules; therefore, the implementation of the other compensation measures was examined. Initially, the annual volume of 600 million euros made available for compensation measures agreed upon in May 2003 was achieved by applying reduced toll rates.

When reducing the motor vehicle tax for heavy goods vehicles and launching the financial assistance programme for the provision of incentives to purchase cleaner heavy goods vehicles on 1 September 2007, the HGV toll rates were raised accordingly at the same time. With the two new compensation measures – the de minimis aid programme and the financial assistance programme for training and skills – which started in 2009, around 600 million euros per year are returned to the road haulage companies in Germany. The reduced toll rates applicable until then have been adapted accordingly.

The commitment given by the Federal Government to compensate hauliers has been fully met since 1 January 2009. In concrete terms, this means:

• reduction of motor vehicle tax for heavy goods vehicles (volume of around 150 million euros per year);
• total of three financial assistance programmes (volume of around 450 million euros per year):- financial assistance programme for the creation of incentives to purchase cleaner heavy goods vehicles (up to 100 million euros per year),- de minimis aid programme (volume of up to 450 million euros per year),- programme for training and skills (volume of up to 90 million euros).