Danish minister defends end-of-life vehicle law

New insurance premium to cover scrap vehicle costs "will be returned" to car owners

Danish tax minister Øle Stavad has insisted that revenue from a newly agreed tax on motor vehicle insurance premiums will be used solely to finance more environmentally friendly disposal of cars and light commercial vehicles. The scheme has attracted widespread criticism since it was passed by parliament earlier this month, amid fears that the levy would become a general purpose tax.

Writing in national newspaper Jyllands Posten on Friday, Mr Stavad said the estimated DKr200m (euros 27m) to be raised annually from the levy would be used to provide a rebate to car owners able prove their cars were disposed of according to strict new environmental criteria.

Under the scheme, car owners will pay a premium of DKr90 on top of their normal car insurance costs from next year, but will receive DKr1,200 when their car is scrapped if they deliver it to an approved car recovery facility. The facilities will be audited through established environmental management systems such as ISO 14001 or EMAS to ensure that they are removing hazardous materials in vehicles and disposing of them properly.

Disposal at such facilities is expected to cost DKr700-800, leaving the remainder of the rebate as a "bonus" in the car owner's pocket. Collection of the levy will start in April next year, with the first payments for disposal expected shortly after.

Leif Mortensen of the Danish EPA told ENDS Daily today that the move was necessary because up to 5,000 cars were being abandoned annually. The disposal criteria were "comparable" to those in the EU's proposed end-of-life vehicles directive, he said (ENDS Daily 18 June).

As currently drafted, the EU directive states that car producers, rather than the "final owner", should be financially responsible for disposal. Mr Mortensen said that Denmark's collective scheme meant that, in practice, the final owner was not responsible for disposal, but stressed that the law could be amended if the European Commission judged that it contravened the forthcoming EU directive.

Follow Up:
Danish EPA, tel: +45 32 66 01 00.

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