Europe's economic recovery after Covid-19: help finance it by applying user-pays and polluter-pays principles in transport

Europe's economic recovery after Covid-19: help finance it by applying user-pays and polluter-pays principles in transport

Wednesday, 1 July 2020

Since March 2020, the EU and its member states have committed more than €3trn to support their economies against the Covid-19 pandemic's immediate economic fallout. Further public money will be spent for the post-crisis recovery. How to finance all that? This paper suggests one important tool: apply user-pays and polluter-pays principles in transport. Concrete measures include distance-based road charging, kerosene taxes and shipping-fuel taxes.

Tapping into this revenue potential, estimated at well over €300bn per year, would provide much-needed financing. It would also give clean and low-carbon transport like rail a fair chance to compete with more polluting modes, thereby supporting the long-awaited modal shift, in line with the European Green Deal's ambitions. Among citizens, businesses and academia there is strong support for a green recovery. Delivering it, also in transport, must be policymakers' main target.

Download the full position paper below to read more.