Cut tax breaks on cars and hike parking fees to meet climate goal, OECD tells Germany

Emissions from cars, trucks, ships, and planes rose to 148m tonnes in 2022 and are crucial in Germany’s bid to slash emissions by two-thirds by 2030, compared with 1990 levels

Traffic-related subsidies in Germany rose by about 35% to €65bn in the decade through 2018. The OECD recommends abolishing tax breaks on company cars or distance allowances for commuters, as well as raising parking fees. 

Germany should cut tax breaks and other subsidies on cars in order to stem the trend of rising carbon emissions in the transport industry, the Organisation for Economic Co-operation and Development has said in a report.

Europe’s largest economy is among the world’s top 10 emitters of carbon emissions, and transport is the country’s problem child. Emissions from cars, trucks, ships, and planes rose to 148m tonnes in 2022 — the second consecutive increase after a pandemic-related dip — and are crucial in Germany’s bid to slash emissions by two-thirds by 2030, compared with 1990 levels.