Thursday, December 6, 2018

What Was the French Fuel Tax Really All About?

This is a topic which hasn't drawn much analytical chat from journalists.  So let's pick up the topic for a minute and think about what the end-product of this tax increase was about.

The facts on the tax?  Two fuel taxes were being set up.  Gas taxes would go up to roughly 12 additional US cents a gallon.  Diesel taxes would go up 24 additional US cents a gallon.

The driving force?  There are two unique pieces to this story.  France has around 70-percent of the car inventory which runs on diesel (more than most other European countries).  Pollution-wise....in major cities, it's a problem (at least the environmental folks say this).  Why did they go so heavily to diesel?  You got better mileage, which was driving people back in the 1970s and onto today....to think better mileage was more important.

The second piece of this story is an effort that came up shortly after being elected President in France.....to ban gas and diesel cars by 2030. 

A fair number of people now believe the tax business was connected to convincing the public that it'd all be better to switch to electrical or hybrid cars with the massive taxation.  Yes, using taxes as a tool to manipulate people into doing something that they aren't that keen upon.  And we aren't talking about a ten-year period of switch.....that you'd already start to see a doubling up of electric car purchases (if you used 2018's numbers) by the end of 2019. 

Does Macron admit either of these two reasons in public?  No.  If he did....the public would have blasted off even earlier.

Were the tax increases cancelled or just suspended?  Well....suspended for six months, meaning he's giving the police six months to develop more capabilities to take down protests or riots. 

Is Macron playing with 'fire'?  The amount of damage done in the interior of Paris has surprised folks.  The fact that these were not 18-year old punks who typically do the riots?  That probably was a bit of a shocker....watching 50-year old guys with yellow vests, in action. 

So all of this returns in early spring (May 2019)?  More or less....right as the EU election occurs.

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