German motorists hit by surging fuel prices

German car drivers are in for a rude shock over the Pentecost weekend as fuel prices jumped to record highs sparking calls from experts and lobby groups to slash taxes.

German motorists hit by surging fuel prices

With petrol prices surging to €1.50 per litre for the first time and diesel only marginally cheaper at €1.45 euros per litre, German politicians and auto industry officials urged the government to take measures to end the woes of enraged motorists.

“The real oil Sheikhs are in Berlin,” Rainer Brüderle, deputy chairman of the opposition FDP party told paper Frankfurter Rundschau on Saturday. He demanded the abolition of high environment and motor vehicle taxes, pointing out that the state “bears responsibility” for two thirds of every petrol station receipt.

Sven Janssen, spokesman of the powerful motoring group ADAC, criticized that the government was raking in more revenue as fuel prices soar. “If fuel prices rise, so does value-added tax revenue because it always amounts to 19 percent of the final price,” Janssen told Berliner Zeitung. He added that this money needed to be given back to taxpayers by lowering mineral oil taxes. In a break-down of the price, the MWV mineral oil association said 65 cents of the price went to fuel tax with a further 24 cents taken in value-added tax (VAT).

Ulrich Klaus Becker, Vice President of the ADAC group demanded that the government hike the so-called Pendlerpauschale or tax allowance offered to commuters linked to the distance of trips to work. He also called for a rethink of the ecological tax. “The state is taking ever larger amounts of taxes from car drivers at a time when millions of people hardly know how they are going to pay the next gas station bill,” Becker told the Kölner Express.

On Friday, oil prices jumped to a new record, breaching $125 a barrel.

Experts fear that the high fuel prices could curb consumer spending and thus dampen economic growth. Rolf Bürkl of the market research group GfK said Germans were increasingly forced to dig deeper into their pockets for fuel. “Commuters in particular can hardly escape the high fuel prices. That’s why we fear that they might put off or cancel other spending plans. That could really hurt economic growth.”