The fuel tax and the obligation to distribute biofuels are driving consumers to reduce their use of fossil fuels.
The majority of differences in consumer fuel prices across the European Union are due to taxes and different fuel content obligations. Taxation and fuel content are regulated at EU level, but there is much national room for maneuver.
The fuel tax in Finland is double the EU minimum level
The EU has set a minimum level of fuel tax in member states. Within the framework of the regulations, Finland could, if it so wishes, almost halve the excise duty.
In addition to excise duty, fuel is subject to VAT. In January, taxes in Finland accounted for 57 per cent of the price of 95-octane petrol.
compared the price and taxation of 95-octane gasoline in the EU in Finland, Sweden, Estonia, Germany and Spain, and outside the EU in Russia and the United States.
Finland has the highest consumer price of petrol in the comparison and the highest tax rate after Russia.
An obligation to distribute biofuels higher than EU standards raises prices
According to EU requirements, 10% of all energy used in transport was to be produced from renewable energy sources by 2020. Before the end of this decade, the share of renewable energy should increase to 14%.
The relatively high distribution obligation is reflected in prices, as the production costs of biofuels are clearly higher than those of fossil petrol and diesel. Prices have risen recently due to rapid growth in demand and poor availability of raw materials.
Of the EU countries, only Sweden has higher targets for the distribution of renewable fuels than Finland.
The remote location shows little in the prices
As Finland is located on the edge of the EU, the transport distances for fuels and oil refining raw materials are long compared to other member states. Higher logistics costs are slightly reflected in consumer prices, but are much less important than taxation and the obligation to distribute renewable fuels.
For the case, the interview was given by a specialist from the Road Traffic Information Center Hanna Kalenoja and Neste’s Vice President, Public Relations Ilkka Räsänen.
Data on fuel taxation and price levels in different countries were collected Kirsi Heikel, Rain School, Maija Salmi and Johanna Juntunen.
You can discuss the topic on 24.2. until 11 p.m.