5

Many media channels are covering the "fuel protests". According to BBC, the main reason behind these protests is fuel (especially diesel) prices raising:

The price of diesel, the most commonly used fuel in French cars, has risen by around 23% over the past 12 months to an average of €1.51 (£1.32; $1.71) per litre, its highest point since the early 2000s.

World oil prices did rise before falling back again but the Macron government raised its hydrocarbon tax this year by 7.6 cents per litre on diesel and 3.9 cents on petrol, as part of a campaign for cleaner cars and fuel.

The decision to impose a further increase of 6.5 cents on diesel and 2.9 cents on petrol on 1 January 2019 was seen as the final straw.

According to fuel-prices-eu, France already has a relatively high price for diesel fuel among European countries.

While the environmental justification makes sense, I am wondering about the urgency (a high price raise / time interval). Why not have a more smoothly increase?

Question: What are the reasons presented by the French government to explain why the price of diesel fuel increased so much in France?

  • Is the question "why have prices risen" (answer because of tax rises) or "why has Macron risen tax?" £1.32 looks quite a bargain, from this side of the channel. – James K Nov 24 '18 at 16:40
  • @JamesK - the question is "why has Macron risen tax?", but the accent is on why so much in a single year (environment issues is a good reason, but it does not account for the relatively high increase). I think the exact figure is not that relevant, but the relative growth is. Where I live, the government increases oil tax from time to time to get more money for the budget, but it ensures that it is done often and in small increments to avoid people being very unhappy. – Alexei Nov 24 '18 at 17:22
  • I vote to leave open, but you might want to rephrase to ask what reasons president Macron (or his party) has put forward. That way, it's more limited in scope and less likely to attract speculative answers. – JJ for Transparency and Monica Nov 25 '18 at 11:17
  • 1
    @JJJ - yes, I have changed the title to make the question more answerable, although Erwan has proved that it can be answered in its initial form. Thanks. – Alexei Nov 25 '18 at 11:22
13

Historically, diesel fuel was taxed at a lower rate than regular fuel in France. This was mostly a way for the government to help the French car-making industry, which had invested significantly in the diesel technology. Thus during a long time it was financially a good choice to buy a diesel car in France, and as a result the share of diesel cars in the French population is still high.

More recently, air pollution has become a serious health challenge. It has been demonstrated that micro-particles are a particularly important factor, and that diesel fuel emits a higher proportion of micro-particles. This issue is becoming critical in large cities like Paris, and lawmakers probably want to be able to say that they did something about it, should this become a major scandal in the future. Additionally the diesel emission scandal (in which some french car makers were involved), didn't help giving diesel a good name.

Overall there was very little reason left to maintain the lower tax level on diesel fuel. This is why it has seen an important increase in the past few years: fuel taxes increase in general, but diesel taxes have increased even more in order to catch up with regular fuel taxes.

As a side note, people used to buy diesel cars because they were economically interesting. Nowadays these old diesel cars tend to belong to people who cannot afford to change for a more efficient model. This is probably one of the factors in the "fuel protests".

  • Also other countries imposed lower taxes on Diesel compared to gasoline, e.g. Austria. I suspect the reasoning behind the lower tax is/was an indirect subsidy to farmers and trucking companies. From a environmental point of view, there is no reason to justify the lower tax rates on Diesel, and many environmentalist groups in Austria critizised this lower tax rate. A chart from 2015 comparing tax rates of some European countries – Dohn Joe Dec 3 '18 at 13:01

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .