30 April 1999

According to press reports, Germany's government is considering raising taxes on gasoline and diesel fuels of high sulfur content next year. A draft legislation would raise tax on high-sulfur gasoline and diesel but not on fuels with a low sulfur content.

The increase in fuel taxes should be introduced not later than 1 July 2000. It could be included in the second phase of the German "ecological tax reform."

The planned tax increases would be 3 pfennigs per liter of gasoline and 4 pfennigs per liter of diesel (in the tax reform's first phase, gasoline prices were raised by 6 pfennigs a liter). The increases could raise 500 million marks in the first year and 350 million marks in the second year. According to a EU Directive, high sulfur fuels should be phased-out by the year 2005.

The use of high sulfur fuels produces emissions of sulfur dioxide and interferes with emission control catalysts. According to a EU 1996 standard (EN 590), the current maximum sulfur content in diesel fuel is 500 ppm.