Climate change taxation reforms and incentives in Austria

Yes, 5 October 2016.

Mineral oil tax (Mineralölsteuer): Mineral oil produced in Austria or imported into Austria as well as fuels and heating fuels used in Austria are subject to mineral oil tax. The mineral oil tax is not measured on the basis of a uniform tax rate. The tax rates are usually written in a way that they refer to 1,000 litres of the respective product. For example, the mineral oil tax is 39.7 cents for a litre of diesel and 48.2 cents for a litre of petrol.

Energy fees (Energieabgaben): Austrian companies have to pay different amounts of fees to the State for the supply and consumption of electricity, natural gas and coal. The fee for electricity is EUR 0.015 per kWh. The fee for natural gas is EUR 0.066 per cubic metre. The fee for coal is EUR 0.005 per kilo.

Car registration tax (Normverbrauchsabgabe): This tax is due when a motor vehicle is purchased from an Austrian dealer or imported into Austria from abroad. This tax must be paid to the tax office either by the dealer or the importer. The amount of the tax depends on the respective CO² emission value of the motor vehicle. The maximum rate is 32%.

Engine-related insurance tax (Motorbezogene Versicherungssteuer): For motor vehicles with a maximum permissible gross weight of up to 3.5 tonnes, the so-called engine-related insurance tax must be paid in addition to the insurance tax. This tax is collected by the insurance companies. The higher the engine power, the higher the engine-related insurance tax.

Levy on flight tickets (Flugabgabe): Every aircraft owner must pay a flight fee to the tax office for every passenger departing from Austria. The flight tax is EUR 3.50 per passenger for short-haul flights, EUR 7.50 for medium-haul flights and EUR 17.50 for long-haul flights.

Contaminated site contribution (Altlastenbeitrag): The commercial depositing or incineration of garbage on Austrian land is subject to the contaminated site contribution. The assessment basis is the weight of the waste. The amount of the contribution depends on the type of waste and is expressed in tonnes. For example, the contaminated site contribution per tonne for depositing waste in a dump can range from EUR 9.20 to EUR 29.80. The state uses these revenues to finance the necessary measures to implement a comprehensive contaminated site management programme in Austria.

Land tax (Grundsteuer): The owner of a domestic property pays an annual property tax to the municipality. This annual property tax is payable quarterly. The basis of assessment is determined by the relevant tax office using a formula. The higher the value of the property, the higher the land tax.

Viennese tree protection fee (Wiener Baumschutzabgabe): To maintain a healthy environment for the Viennese population, the tree population in the Vienna area is protected. Every landowner is obliged to preserve the stock of trees on his property. If a tree is removed without replacement planting, the landowner must pay a tree protection fee. The tree protection fee is EUR 1,090 per removed tree.

No.

• A research bonus of 14 percent can be claimed for expenses for research and experimental development. Eligible are both in-house research as well as commissioned research. The research bonus is not taxable.
• The Environmental Aid Act supports Austrian companies with grants that invest in environmental and climate protection measures. The subsidies in 2018 supported almost 14,000 projects.
• The Federal Climate and Energy Fund supports companies and private individuals with grants in the sectors of energy system transformation, mobility transformation and climate change. The fund has already supported more than 137,000 projects.
• Since 2019, the purchase of electric vehicles has been supported with grants. For example, the purchase of an electric car with purely electric drive is supported with EUR 3,000.
• The construction of new buildings for business purposes in an energy-efficient construction method is supported. The subsidy amounts up to 30 % of the additional investment costs.

The new government programme 2020-2024 announces an eco-social tax reform. Among other things, the following tax-ecological measures will be taken:

• Modification regarding the levy on flight tickets. The levy on short-haul and medium-haul flights will be increased significantly. However, the levy for long-haul flights will be reduced.
• The engine-related insurance tax will be increased, without cap.
• Take appropriate measures to combat tank tourism and heavy truck traffic from abroad.
• Provide stronger incentives for emission-free company cars.
• Provide stronger incentives for environmentally friendly company mobility of employees through tax incentives for support services (e.g. cycling, electric bikes).

N/A