Living Car Free - Experts agree that high car taxes decrease Danes' mobility and restrict their job opp

From the Copenhagen Post: http://www.cphpost.dk/get/101158.html.

Not sure that a metalworkers' union is exactly unbiased, but it's interesting nonetheless. There's something to be said for the mobility (in the socio-economic sense) provided by a car: increase job opportunities, etc. I'm not really trying to start an argument; just curious to hear others' take.

And yes, new car registration costs 180% the cost of the car.

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"High taxes on cars effectively put the brakes on the country's economy, according to a study conducted for the Danish National Union of Metalworkers.

The country's 180 percent registration fee makes Denmark one of the most expensive countries in which to own a car. If the fee was reduced, some 200,000 people would have an easier time finding work, the union found.

'High demands are made to employees' mobility, but efforts that make it easier or less expensive for people to be more mobile are few,' Mikael Bay Hansen, an economist for the union, told Berlingske Tidende newspaper.

The Confederation of Danish Commercial Transportation and Service Industries (HTS) joined the union in lobbying the government to lower the fee.

'We see it as a problem that high taxes mean that some people cannot afford to have a car and others pass up on jobs, because the family cannot afford to buy an extra vehicle,' said Lars Storr-Hansen, HTS.

Christian Wichmann Matthiessen, a geography professor who sits on the government's infrastructure commission, noted that although high registration fees helped to limit automobiles' negative aspects such as pollution and accidents, cars were necessary outside major cities, where public transportation is limited.

The proposal from the Union of Metalworkers and HTS comes as the Liberal-Conservative government is considering whether to reduce taxes on a number products.

Jakob Axel Nielsen, the Conservatives party's tax spokesperson, welcomed the proposal, saying the party would help lower the price of environmentally friendly cars.

'The car is part of a mobile labour market and necessary for infrastructure to function,' said Nielsen.

The prime minister's Liberal party, on the other hand, was more guarded about reducing taxes on cars, saying it preferred to find ways to reduce income tax."

'We see it as a problem that high taxes mean that some people cannot afford to have a car and others pass up on jobs, because the family cannot afford to buy an extra vehicle,' said Lars Storr-Hansen, HTS.


This is the same argument the American Dream Coalition states in their website. Here's how I view it.

First, people can't afford cars not due to one factor (ex. Registration) but due to many factors. The cost of gas in Europe, taxes, insurance, car payments, repairs, tolls, tickets and maintenance make motoring expensive in any part of the world.

Furthermore, this notion that families need more than one car is nonsense. What are the Danes doing today to survive because it appears they are doing fine? Are they suffering from massive unemployment where tens of millions cannot find work? Have all the good paying jobs moved to the burbs only accessable by motorcar? How much more are these jobs in the burbs paying because I'm fairly certain, the added cost of a motorcar will send tens of million into bankruptcy as it does in the U.S. In my opinion, keep the tax in place and have it fund more mass transit.

The last thing they need are more cars on the road.

So the answer is lowering taxes on cars which would make them more affordable so more people could drive?

I find that interesting. IIRC I read an post here and a series of articles about Danes having one of the highest standards of living in the world. As well as being one of the highest taxed, however they put it back out in a massive social services network. And their government is not bankrupt or running in deficit. In fact other governments from around the world have been studying to see how they do it.

Aaron:)

Furthermore, this notion that families need more than one car is nonsense. What are the Danes doing today to survive because it appears they are doing fine? Are they suffering from massive unemployment where tens of millions cannot find work? Have all the good paying jobs moved to the burbs only accessable by motorcar?

Except for the tens of millions part (Denmark's total population is ca. six million) ;), this is perceptive. The economy here is currently booming with unemployment under 4%, I think, though there is some concern about retaining engineers and scientists (I get a reduction in taxes because I'm a guest worker in engineering).

Obviously, cars can provide a certain amount of mobility. Contrary to my original post, what I meant to say is a car can provide literal mobility, which can lead to increased job opportunities, and increased social mobility. I know one or two people who commute, by car, over 50km each way to work, but this is not the norm. (I also know people who commute 1.5 hours each way by train to Copenhagen).

But the claim in the article that people need cars outside of Copenhagen (where the transit system is top notch) is a little ludicrous. Odense, the third largest city, is easily accessible by bike (I live in the 'suburbs', if you could call it that, a whopping 5-6 km from downtown), and there are two bus systems (one for in town, one for the rest of the island), plus the train. Sure, you can find plenty of places to live where you'd need a car, but if you live in the city, there's no job you'd have to pass up because of transportation issues. Let alone jobs for both spouses.



How much more are these jobs in the burbs paying because I'm fairly certain, the added cost of a motorcar will send tens of million into bankruptcy as it does in the U.S. In my opinion, keep the tax in place and have it fund more mass transit.


I don't know about bankruptcy -- if cars were cheaper then they could be afforded -- I know very few people who have two cars, and they seem to be doing fine. After all, a recent survey showed that the Danes are the happiest people in the world.

The grass is always greener on the other side.

When Brits, Norweigians, and Danes come over here to Houston to work in the local oil industry, they always want to buy the biggest, gnarliest SUV / truck. Then they put a sticker of their national flag in the back window; next to the gun rack.

They might fantasize about going over to the dark side (low cost car ownership), in their furtive Euro-dreams, but if they really did it, I don't think they'd like it.

My impression is, if the goverment were to lower the taxes, you would see car dealers and gas stations raise their prices. The market is supporting what people are willing to pay with or without goverment interference. But I'm no expert so hey I might be wrong.

My impression is, if the goverment were to lower the taxes, you would see car dealers and gas stations raise their prices. The market is supporting what people are willing to pay with or without goverment interference. But I'm no expert so hey I might be wrong.

To some extent, yes. Typically, a tax X will raise the price of a commodity by some amount less than X. So a $10,000 tax might raise prices $8,000. What the exact fraction is, is up to the market to determine, and the economists to prognosticate.

Christian Wichmann Matthiessen, a geography professor who sits on the government's infrastructure commission, noted that although high registration fees helped to limit automobiles' negative aspects such as pollution and accidents, cars were necessary outside major cities, where public transportation is limited.


If this is true, the long range solution would be to improve public transit in rural areas. high taxes should help accomplish this.

If this is true, the long range solution would be to improve public transit in rural areas. high taxes should help accomplish this.

Another possibility is a network of car pools. Here in Iowa, there is a network called "RideShare" which allows commuters from out of town to ride in a van along with about 8 others. A lady at my office takes advantage of this: the van drops her off at the office in the morning and picks her up at 5:00. This makes commuting from rural areas feasible without having a major public transit infrastructure. As well, it is a lot more cost-effective for her.

Another possibility is a network of car pools. Here in Iowa, there is a network called "RideShare" which allows commuters from out of town to ride in a van along with about 8 others. A lady at my office takes advantage of this: the van drops her off at the office in the morning and picks her up at 5:00. This makes commuting from rural areas feasible without having a major public transit infrastructure. As well, it is a lot more cost-effective for her.

We have a few of those around this area too. Typically they run from the smaller towns into the larger ones. Only problem with those is if you get caught working late or there is an emergency you are screwed. But carpooling is a good thing if it can be made to work.

Aaron:)

Car drivers screw up the planet so badly in so many ways... the least we can do is make 'em pay for the resources they are using. Whining about how they are forced to pay to much is like complaining that you can't go to a store and get free groceries. You gotta pay for what you use, duh. Owning a car costs so little in North America because it is very heavily subsidized.

My impression is, if the goverment were to lower the taxes, you would see car dealers and gas stations raise their prices. The market is supporting what people are willing to pay with or without goverment interference. But I'm no expert so hey I might be wrong.


An X amount tax will raise the price of the commodity by some amount less than X

yes. the reason is that when prices go up people buy less, prompting the highest-price sellers (those who are least eager to sell) to simply not sell. Lower the price of car-use in Denmark and more people will use cars, but not to such an extent that the total (after-tax) amount people spend on cars will stay the same.