3FOOD

Third Industrial Revolution Consulting Group
Diesel fuel excise fees are so low that they promote “fuel tourism” with non-residents fueling
up in Luxembourg to take advantage of the low fuel prices. While this policy reaps the
government tax revenues from non-residents (€745 million in 2015) it is having pernicious,
unwanted side effects. Traffic congestion, noise, and exhaust pollution from the diesel fumes
are a daily nuisance. Luxembourg incurs an annual energy trade balance deficit because of its
need to import over 95% of petroleum and natural gas products. The steep rise in
transportation CO 2 emissions is proving difficult to curtail. And Luxembourg has among the
highest motorization rates in the EU, and well as among the EU’s highest amount of time spent
driving.
Another confounding policy is Luxembourg’s vehicle registration fee, which is the same (€50)
regardless of whether the vehicle is fuel sipping or diesel guzzling. Most European countries
have implemented variable vehicle registration taxes/fees, based on fuel efficiency/inefficiency,
fuel type, and level of CO 2 emissions. For example, the Netherlands (as well as Spain and
Ireland) reduces registration fees for the most fuel-efficient cars. To register a Ford Fiesta costs
€7,080, whereas a comparable priced Fiat 500 only incurs a €2,386 registration fee because it
releases much lower CO 2 emissions. This similar policy practice in Ireland led to 90% of vehicle
sales in lower-emission vehicle classes. Luxembourg’s one fee fits all sizes, on the other hand,
has no influence on the buyer’s vehicle selection. Moreover, the Luxembourg tax regime in
regards to company cars results in including a vehicle as in-kind benefits to employees’
remuneration offers.
A key part of the 2016 Study on Assessing the Environmental Fiscal Reform Potential for the
EU28, issued by the DG Environment of the European Commission, are recommendations
reflecting the full costs of fossil fuels. The recommendations, summarized in Tables 25-4, 25-6
and 25-9, offer guidance for Luxembourg lawmakers and stakeholders.
Waste Streams
If there is an eye-opening reality to the loss of wealth in the linear economy, it is captured in
the fact that 50 to 75 percent of all natural resources consumption becomes pollution and
waste within 12 months. 305 Closing the loop, turning wastes into nutrients, reducing the need
for virgin resources, and innovating through pursuit of biomimicry processes, are essential for
expanding prosperity and wellbeing while collapsing waste and pollution.
305 Matthews, Emily et al (2000) The Weight of Nations, http://www.wri.org/
358