CO2 LEVY REGULATION VEHICLES: LEGAL BASIS OF THE CO2 LEVY

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The CO2 Ordinance of 20 November 2012 regulates the reduction of greenhouse gas emissions in Switzerland. The legal basis for the CO2 Ordinance is the Swiss CO2 Act of 23 December 2011. The CO2 Regulation is based on the provisions of the European Union on the reduction of CO2 emissions (initially EU Regulation 443/2009 of 23 April 2009, recast and repealed by EU Regulation 2019/631 of 17 April 2019).

THE GOAL OF THE CO2 REGULATION: REDUCTION OF ALL GREENHOUSE GAS EMISSIONS

The CO2 regulation aims not only to reduce emissions of carbon dioxide, but to reduce emissions of all greenhouse gases. In order to be able to compare the warming effect of the different greenhouse gases, they are converted into so-called CO2 equivalents (CO2eq). The published emission data, CO2 targets and CO2 target attainment each refer to the sum of the warming effect of all greenhouse gases expressed in CO2eq. The CO2 regulation takes into account the following greenhouse gases:

Carbon dioxide (CO2 equivalent, CO2eq: 1.0)
Methane (25)
Nitrous oxide (298)
Fluorocarbons (between 12 and 14,800)
perfluorinated hydrocarbons (between 7,390 and 12,200)
Sulphur hexafluoride (22,800)
Nitrogen trifluoride (17,200) (see Annex 1 to the CO2 Ordinance)

WHO IS AFFECTED BY THE CO2 REGULATION?

The CO2 regulation for vehicles concerns

Importers and Swiss manufacturers
of passenger cars and light commercial vehicles,
which are placed on the market for the first time.
(Article 17(2) CO2 Regulation)
The first placing on the market is deemed to be the first admission in Switzerland, in a customs exclusion zone (Article 3 paragraph 3 Customs Act) or in Liechtenstein.
Expressly exempt from the regulations of the CO2 Ordinance are vehicles “which were registered abroad more than six months before the customs declaration in Switzerland”.

CO2 LEVY ON CARS AS A SANCTION FOR EXCEEDING CO2 TARGETS

Manufacturers and importers must pay a CO2 tax if the vehicles manufactured or imported in Switzerland exceed certain CO2 target values. The CO2 target values are

for passenger cars 130 g/km (until 2019) or 95 g/km (from 2020) and
for light commercial vehicles 147 g/km (from 2020).

The development of the total amount of the CO2 levy for 2019 compared to 2018 is likely to be determined not only by the CO2 target achievement, but also by the further development of the car economy.

CO2 LEVY ON FOSSIL FUELS

A distinction must be made between the CO2 tax on cars and the CO2 tax on fossil fuels, which has been levied since 2014 in the event of non-compliance with certain legally prescribed CO2 emission reductions (compared to 1990). Per tonne of CO2 emissions, the 2015 CO2 levy was CHF 60 and the 2016 CO2 levy and the 2017 CO2 levy were CHF 72 or CHF 84, depending on the deviation from the target. The levy rate for the 2018 CO2 levy, the 2019 CO2 levy and the 2020 CO2 levy is CHF 96 or CHF 120 per tonne of CO2, depending on the target deviation (Article 94(1) CO2 Ordinance).

CO2 REGULATION VEHICLES: DEFINITIONS AND OBJECTIVES

The CO2 Regulation defines

CO2 emission targets for those vehicles that are subject to the CO2 regulations: passenger cars and light commercial vehicles (vans and light articulated lorries) that are placed on the market in Switzerland for the first time,
the status of small and large importers depending on the size of an import fleet (large importers import at least 50 passenger cars or six light commercial vehicles per calendar year),
and

The CO2 Regulation enables

the formation of emission pools by importers or manufacturers (for one to five years at a time) so that they receive the rights of large importers (no billing of individual vehicles, but one-off annual billing of the CO2 levy on the average emissions of an import fleet),
Special CO2 targets for small and niche manufacturers and
the crediting of emission reductions abroad certified by emission reduction certificates (Article 4 CO2 Ordinance). The recognition of a foreign emission reduction project must be applied for at the Federal Office for the Environment (FOEN) (Article 4a CO2 Ordinance).

THE WAY TO THE CO2 LAW SWITZERLAND AND THE CO2 ORDINANCE

1992: UN Framework Convention on Climate Change in New York.
1997: Kyoto Protocol on climate protection.
2000: CO2 Law Switzerland. Festlegung verbindlicher Ziele für die Reduzierung der CO2-Emissionen.
2008: Swiss CO2 tax on heating oil and natural gas.
2012: Commitment to reduce Swiss greenhouse gas emissions (20 per cent by 2020 compared to 1990).
2012: Switzerland introduces CO2 emission target values of 130 g/km for passenger cars.
2012: Switzerland: CO2 Ordinance on the Reduction of Greenhouse Gas Emissions.
2015: Paris Agreement (successor to the Kyoto Protocol): Switzerland commits to halving CO2 emissions by 2030 (compared to 1990).
Development of the annual totals of the CO2 levy on automobiles:
- CO2 levy 2015: CHF 12.6 million
- CO2 levy 2016: CHF 2.4 million
- CO2 levy 2017: CHF 2.9 million
- CO2 levy 2018: CHF 31.1 million

CO2 levy 2018: 31.1 million (The development of the total amount of the CO2 levy in 2019 compared to 2018 is likely to be determined not only by the CO2 target achievement but also by the further development of the car economy).

From 2018: Legislative process for a revised Swiss CO2 law. Goal: Adaptation to the 2030 climate targets of the Paris Agreement.
CO2 target values from 2020:
- Passenger car: 95 g/km
- light commercial vehicles: 147 g/km

The 2020 CO2 levy will also include light commercial vehicles for the first time.

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