(CN) – Germany discriminates against foreign drivers by making everyone pay a highway toll and then giving a tax rebate only to residents, Europe’s highest court ruled Tuesday.
The decision from the European Court of Justice came four months after an advocate general recommended dismissing Austria’s challenge to the toll.
Germany imposes the charge known as a vignette on all foreign drivers who enter a federal road after crossing a national border. The vignettes come in three time spans: 10 days, two months or annual.
Depending on cylinder capacity, the type of engine and the class of emission, the cheapest 10-day vignette costs €2.50, while the most expensive annual vignette costs €130 ($146).
German vehicle owners pay the charge as well at the time of registration, but they get whatever they paid back in the form of a tax rebate. Owners of Euro 6 vehicles — cars that comply with the he latest engine-emission standards set by the European Union — actually get more money back.
On Tuesday, the Luxembourg-based Grand Chamber of the court called it apparent that the scheme favors Germans over foreign drivers.
“While the difference in treatment that has been identified is not directly based on nationality, the fact remains that the vast majority of owners and drivers of vehicles registered in member states other than Germany are not German nationals, whereas the vast majority of owners of vehicles registered in Germany are German nationals, so that such a difference has in fact the same outcome as a difference in treatment based on nationality,” the opinion states.
While Germany noted that it already makes residents pay for road infrastructure through a motor vehicle tax, the court said the government “has produced no details of the extent of that contribution and has therefore in no way established that the compensation granted to those owners, in the form of a relief from that tax in an amount at least equivalent to the amount of the infrastructure use charge, does not exceed that contribution and is therefore appropriate.”
The court took issue as well with Germany’s mandate that the charge applies even to vehicle owners who never make use of federal roads.
Owners of vehicles registered in Germany are automatically subject to the annual charge, with no opportunity to choose a smaller vignette.
“Those factors, coupled with the fact that those owners qualify moreover for a relief from the motor vehicle tax in an amount that is at least equivalent to the amount paid with respect to that charge, demonstrate that movement to a system of financing based on the ‘user pays’ and ‘polluter pays’ principles in reality affects exclusively the owners and drivers of vehicles registered in Member States other than Germany, whereas the principle of financing by means of taxation continues to apply with respect to owners of vehicles registered in Germany,” the ruling states.