Norway And Taxing Emissions

Norway – The Norwegian Motorcycle Union (NMCU) – formed in 1972 and the sole organisation looking after the interests of Norwegian road-riding motorcyclists – reports that its government has added to the CO2 (Carbon dioxide) emissions fee which will lead to a dramatic increase in tax on some new models from motorcycle manufacturers.

The Norwegian government’s new budget sees the government introduce a CO2 component in the calculation of a one-time emissions fee (purchase/import/registration tax) from 1st July 2017 for motorcycles in line with the system for cars.

This tax will mean a dramatic increase in tax on some of the top models from three manufacturers, Yamaha – Kawasaki – Aprilia – Moto Guzzi.

Due to their high CO2 emissions, the Yamaha MT-10 SP receives an additional tax of kr. 40 728 (€4,420 – £3,879) – Kawasaki Z900 an additional tax of kr. 37 872 (€4,117 – £3,613) – Aprilia Tueno V4 1100RR an additional tax of kr. 36 253 (€3,941 – £3,457) and the Moto Guzzi Audace an additional tax of kr. 76 213 (€8,284 – £7,268).

NMCU has sent a letter to the Europa office of Yamaha, Kawasaki and Piaggio and noted the change in the Norwegian motor vehicle tax calculation.

Morten Hansen from the NMCU says, “To be honest, I’m a little surprised that leading motorcycle manufacturers launch brand new 2017 models with higher CO2 emissions than a 2.5-ton heavy Volvo XC90 SUV with a 2-liter petrol engine of 250hp.”

“The increase in charges will unfortunately have a negative effect on the sale of these models in Norway,” said Morten Hansen, Secretary General of the NMCU.

NMCU comment that one might say that the Norwegian market is so microscopic that it does not matter much to the bottom line of the manufacturers, but both NMCU and FEMA (Federation of European Motorcyclists Associations) think Norway is only the first of several countries in Europe that will introduce some form of emission-based MC-fee.

In a letter to the manufacturers, NMCU emphasizes that motorcyclists of course would like to keep top models from the various manufacturers on the market, but with CO 2 emissions of almost 180 g / km (or even more!) There is a high risk of high Performance motorcycles in a little while will become a rare sight due to high environmental taxes and environmental-based restrictions on use in the big cities.

In the letter the NMCU also put direct questions to Yamaha, Kawasaki and Piaggio.

“If there is something they, as manufacturers, can do to lower CO2 emissions from their high performance models – if necessary at the expense of slightly lower power or slightly lower peak speed, which for many of us would be an acceptable price to pay to keep these beautiful motorcycles on the Norwegian market”? 

NMCU also emphasizes that it is only high performance motorcycles that have an unreasonably high CO 2 emission. Most of the motorcycle models in the Norwegian market are far more climate-friendly than many might have thought!

Careful What You Wish For

In a world where we see that motorcycles or rather the Powered Two Wheeler (Motorcycle – Scooter – Moped) are claimed as congestion busting, enable shorter journey times, cut commuting costs, reduce pollution, are lighter, use less fuel , use less raw materials in their construction and have social benefits, then a problem arises when all of this is related to a positive pay-off for these claims.

It is suggested that there should be exemptions in relation to user-charging, congestion charging, road tolls or exemptions or no bans for riding in clean air charge zones or seeking parity on zero-rating of Vehicle Excise Duty (VED – Vehicle Excise Duty – UK) on eco-friendly motorcycles, (whether these are through changes to central government policies, local authorities or road operators).

However we have to be careful what we wish for.

As motorcycle manufacturers are now required to publish the emissions of new motorcycles, just like car manufacturers, then governments like Norway, have factual information – as factual as what they publish – to base a system of taxation on according to the environmental “benefits” that vehicle would have or not within rates based on a vehicle’s CO2 emissions.

In the UK VED taxation on motorcycles is based on their engine size, so the three motorcycles that have relatively high emissions – the Yamaha MT-10 SP – Kawasaki Z900 – Aprilia Tueno V4 1100RR – Moto Guzzi Audace – would pay because they are over 600cc, a yearly rate of VED from new of £85.

However if the UK VED system for motorcycles was an emissions rate based on a vehicle’s CO2 emissions the first time it’s registered, the same as for cars and some motorhomes registered on or after 1st April 2017 then these motorcycle as petrol powered motorcycles with CO 2 emissions of almost 180 g / km, on a like to like basis would pay:

• On first registration for 12 months – £800;  from the second year and subsequent years – £140
• If the 180 g / km emissions rate for older vehicles – registered between 1 March 2001 and 31 March 2017 were applied, then the yearly VED emissions tax would be £240.
• Cars and light goods vehicles registered before 1st March 2001 have a flat rate based on their engine size of either £150 or £250.

Of course the rate formula might end up being cheaper than present for the small commuter bikes but what about larger bikes that also have high CO2 emissions –  as has been implemented in Norway, in this case with the manufacturers “to blame” ?

Sometimes it’s best just to stay schtum

Ian Churchlow, MAG UK director and MAG UK representative at FEMA, believes that the UK should adopt a tax regime like the one introduced in Norway, i.e. based on emissions, in fact he states:

“The existing UK motor tax regime has a number of fundamental flaws, which make it structurally unfit for purpose. Put simply, the UK tax on motorcycles conflicts with the wider European trend of including environmental and safety incentives on all motor vehicle taxation and the UK’s current system absolutely violates the concept of equal treatment for all road user groups. The present tax levy has become nothing more than a fiscal tax on motorcycle ownership and it has nothing to do with the comparative benefits that a motorcycle brings to the environment.”

Just to clarify, the new UK road tax regime means that bikes up to 150cc pay £18 per
annum; 151 – 400 is £41 p.a.; 401-600 is £62. Highest tax for bikes over 600cc – is £85 p.a.

Simply, the tax is linked to engine size, not emissions – for motorcycles and trikes – i.e. same as before the new regime. Basically, there has been an increase of between £1 and £3 for Motorcycles/scooters and mopeds. Historical vehicles 40 years old are exempt.

Ian Churchlow also has accused politicians of being at the root of non-exemptions, “A reflection of the ignorance (even arrogance) of our politicians subliminal message that motorcycling is essentially wrong and that we should be discouraged from owning or riding a motorcycle.”

Organisations and their positions on the issues change with time but sometimes the basics are the best – the following is from the Motorcycle Action group in 2002:

• “VED should be totally abolished for motorcycles so as to encourage more ownership of motorcycles as second vehicles and so as to avoid penalising those riders that own more than one bike. After all, you can only ride one at once. VED is a tax on ownership, not use. Vehicle use is the problem that creates congestion and pollution, ownership isn’t.
• At the very least there should be no alteration of bands and no increase in VED whatsoever for any type of bike.
• By way of clarification MAG will not support zero-rating small (sub 125cc) scooters and mopeds with a consequent increase in the VED payable by owners of larger machines to make up the short fall. MAG believes that if bikers are to pay VED then all should pay their fair share. Why should a Honda Fireblade rider subsidise one who rides an Italjet scooter? A tank of gas on most large bikes costs more than a year’s tax on a 125”.

The British Motorcyclists Federation (BMF) looked previously at the banding for Vehicle Excise Duty to be restructured to better reflect motorcycle usage:

• Up to 50 cc
• 51 cc-125cc
• 126 cc – 500 cc
• Over 500 cc

With the lowest category to be subject to no annual fee.

Meanwhile FEMA recently stated that there was a fear that motorcyclists who may no longer allowed to commute on their low-cost, pre-2006 motorcycles, could abandon motorcycling and switch to using a car instead.

The assumption was that 87% of 5,402 people from 30 countries who took part in a FEMA survey (270 women and 5,132 men), would not be willing to invest in a more expensive non-emissions bike. If fossil fuel vehicles were ever banned from entering the city, 76% would rather change transport mode than buy a non-emissions bike.

Governments have emission figures in black and white with emissions reductions over the next few years now firmly in their sights. Now they have the opportunity to change charging on taxation and as in certain cities in France, banning certain vehicles altogether or like London to charge Powered Two Wheelers the same as other vehicles, at a cheaper rate, for entry and use of Ultra Low Emission Zones.

Welcome to the new world order of doing your bit to reduce carbon emissions.

Original Sources

NMCU – The Norwegian Motorcycle Union – Via Google Translate

NMCU’s letter to the manufacturers – pdf

Vehicle tax rates – GOV.UK

‘The motor vehicle tax regime in the UK creates a failure of trust” MAG Opinion – via FEMA

Low-emission zones and city bans could force motorcyclists into cars – FEMA

Vehicle Excise Duty – Where MAG Stands and Why – 2002

BMF – Manifesto and Constitution

Motorcycle Mind on Emissions