Fuel prices rose across the European Union this month, but the war in Iran is not alone to blame for this painful increase.
Besides the market-driven rise due to the conflict, the tax component also played a role, worsening the situation in many countries, including Germany.
Taxes account for more than 50% of pump prices in the EU
Gasoline and diesel prices have risen significantly in Europe since the United States and Israel launched their military operation against Iran at the end of last February.
But the rising cost of crude oil is not the only reason for this increase, as taxes are responsible for a large portion of final prices at gas stations across the Old Continent.
Euronews noted in a report on Friday that taxes account for more than half of fuel bills overall, and they explain why drivers in some member states pay more than others.
While everyone feels that more than $100 per barrel of Brent crude, taxes such as VAT, customs duties and other specific fees determine the final cost in each individual case.
These duties represent 52.1% of the price of regular gas, Eurosuper 95, and 44.5% of the price of diesel, on average in the EU, according to Fuel. Data Compiled by the European Commission.
Taxes have the smallest share in Bulgaria, Spain and Hungary – 43.9, 45 and 45.2% – and the largest in Finland, Ireland and Slovenia – 57.2, 57.3 and 57.8% respectively.
In the 20 member states, total taxes represent more than 50% of the price of gasoline. Among the largest economies in the European Union, Italy leads with 55%, followed by Germany and France with 54.5% and 53%.
The study authors point out that the tax classification differs between petrol and diesel, and the burden is generally lower for the latter, averaging 44.6% for the entire EU.
Taxes account for less than 40% of the diesel price in four countries – Estonia (37.6%), Spain (38%), Sweden (38.5%), Bulgaria (39.7%), and more than 50% in Slovenia (50.1%), Ireland (50.6%), Italy (51.1%) and Malta (54.3%).
The pre-tax rule varies between member states
Pre-tax fuel prices vary widely between member states, which affects final prices as well. A high tax share does not necessarily lead to an equally high final price, as is the case with Slovenia, which has the highest gas tax rate, but not the highest price.
According to figures provided by Eurostat, the average price of gasoline in the European Union, including tax, was 1.84 euros per liter as of March 16 (about $2.12 at the current exchange rate).
Eurosuper 95 was the most expensive in the Netherlands (€2.26), Denmark (€2.18), and Germany (€2.09), and cheapest in Bulgaria (€1.33), Malta (€1.34), Cyprus (€1.42) and Slovenia (€1.44).
The Netherlands (€2.26), Denmark (€2.21), Germany (€2.15), Finland (€2.11), and Italy (€2.03) recorded the highest diesel prices, while Malta (€1.21), Bulgaria (€1.44), and Slovenia (€1.48) saw the lowest prices. The EU average was €1.95 per liter ($2.25 at the time of writing).
Germany records some of the sharpest jumps in prices
While the European Union sets minimum customs duties on fuel, member states are free to set higher rates, including value-added tax. Some countries impose different carbon, energy or other taxes, which creates an additional burden Fuel prices.
This is the case in Germany, the bloc’s economic powerhouse, which charges more fees than other European countries for environmental reasons, including carbon dioxide consumption, and to finance its infrastructure.
As a result, the price of gasoline in the Federal Republic has risen by almost 5% in the past two weeks, while neighboring Austria and France have seen a 2% increase, Euronews highlighted in another report.
The European Commission has also noted this increase Germany Among the members with the highest increases are the Netherlands, Denmark and Finland.
While the task force set up by the government in Berlin to address the issue accused oil companies of price gouging, the industry responded to the attack by reminding it that more than half of the price of fuel consists of taxes and fees, and urged the authorities to look into these components first.
