Stockholm congestion tax

Official Swedish "Road toll" sign

Payment of the congestion tax cannot be made at the control points — they merely register which vehicles have passed them. A bill is sent to the vehicle owner at the end of each month, with the tax decisions for the preceding month's control point passages. The bill must be paid before the end of the next month. The vehicle owner is responsible for the payment of the tax, even if the bill does not arrive.[15]

The bill can be delivered in three different ways. By default delivery by mail to the vehicle owner's registered address, or opting for electronic delivery to the vehicle owner's Internet bank, or opting for a direct debit arrangement called Autogiro[16] that allows the tax to be automatically deducted from the vehicle owner's bank account when the bill is due.[15]

Failure to pay the tax within the allotted time results in a reminder bill being sent with an added 500 SEK fee. If the tax along with the reminder fee is still unpaid within 30 days after the reminder bill was sent, the case will be forwarded to the Swedish Enforcement Administration, which adds an additional fee of at least 600 SEK, and the vehicle owner will be noted in the Enforcement Register unless payment is made.[17]

The same rules are from 2015 valid for foreign-registered vehicles. The authority has contracted collection agencies in the most common countries who charge the owners.[18]

The congestion tax may be deducted from taxable income for both private individuals and businesses. Private individuals may deduct the congestion tax for business journeys, and for traveling between the home and workplace according to the usual rules of car cost deduction (1:80 SEK/km), that is if the distance is at least 5 kilometres (3.1 mi) and the time saved by traveling by own car compared to public transport is at least 2 hours per day. If this is not valid, the public transport cost can be deducted (without congestion tax). The first 10.000 SEK can not be deducted (the public transport pass inside Stockholm county costs 8.400 SEK during year 2016). Businesses may deduct all congestion tax expenses, also private driving with company cars (there is a general tax on the right to drive company cars in private).[19]

Some classes of vehicles are exempt from the congestion tax:[20]

• Emergency services vehicles
• Buses with a total weight of at least 14 tonnes
• Diplomatic corps registered vehicles
• Motorcycles
• Military vehicles
• Cars that according to the Swedish Road Administration's vehicle registry are equipped for propulsion with entirely or partially with electricity, or other fuel gas than liquefied petroleum gas, or with a fuel mixture that predominantly consists of alcohol. This exemption is no longer valid for newly purchased vehicles, but remains valid for vehicles purchased between January 1, 2009 and August 1, 2012.
• Cars with parking permit for disabled persons, after application to the Swedish National Tax Board. This exemption is not valid if the car is used for professional purposes.[21]

Foreign-registered vehicles were exempt from the congestion tax until 2014. This was mainly for practical reasons, as it was hard to get access to foreign car registers and to claim payment from foreign citizens. The exemption was removed as a result of objections from companies relating to unfair taxation, and because the "Eurovignette" EU directive (1999/62/EC article 7 and 2006/38/EC) requires that user charges may not discriminate on the grounds of the nationality of the haulier or the origin of the vehicle.

The congestion tax was before its inception a highly debated proposition, especially in the peripheral parts of Stockholm county where residents who lived outside of the control points but worked in the city center argued that they should also have a say in whether the proposition was to be accepted. In the time since the control points were put in place, however, the debate has calmed down considerably as the system works smoothly and the actual cost of passing these stations is acceptable to most residents, as well as the fact that central Stockholm has been getting cleaner since the proposition went into action. The debate has instead in many instances shifted toward the political reasons behind the proposition, where some argue that the proposition is simply a way to punish the residents of Stockholm for the centralized Swedish political system, which reportedly many people in rural parts of Sweden feel favours Stockholm above other regions.

Initially this was planned as a congestion fee, not a tax. But the Swedish government ruled that this kind of endeavor was considered a tax and not a fee, and thus this was made a governmental tax, not a local tax, as municipalities in Sweden are not allowed to create new taxes.

A seven-month trial period of the congestion tax, called The Stockholm trials (Stockholmsförsöket),[4] took place between January 3, 2006 and July 31, 2006. In addition to the optical recognition of license plates, DSRC transponders were used to identify vehicles, and opting to use one was a precondition for using direct debit for the payment of the tax.

The Road Administration have claimed that traffic passing in and out of the cordon reduced by between 20 and 25% during the period of the trial, and that air quality improved; after the trial, traffic volumes built up again. 96% complied with paying the tax on time, which raised 399 m SEK during the period.[23]

Local consultative referendums regarding whether to permanently implement the congestion tax were held in Stockholm Municipality and several other municipalities in Stockholm County on September 17, 2006.

It was only the referendum in Stockholm Municipality that the at the time reigning government would use as a basis for the decision. The municipalities surrounding Stockholm in Stockholm County, especially those that are part of the city of Stockholm, showed discontent with the fact that the people of those municipalities get no say whether the congestion taxes will be implemented permanently. A substantial number of the inhabitants of the nearby municipalities travel to and from work through the congestion tax area. Therefore, several of these municipalities decided also to have local referendums. A municipality is allowed to hold a consultative referendum at any time, but as the congestion tax had to be decided at the national parliament level it was unclear how the results would be interpreted if the government there changed after the 2006 general election, which was held the same day as these referendums.

In Stockholm the question asked on the ballots was (translated from Swedish): sv:Trängselskatt i Stockholm#Fördelning och demokrati

Environmental fees/congestion tax means that fees will be charged in road traffic with the purpose to reduce queuing and improve the environment. The income will be returned to the Stockholm region for investments in public transport and roads.

In the other municipalities the question on the ballots were (translated from Swedish):

Do you believe that congestion tax should be permanently introduced in Stockholm?

Results from the referendums. The figures and percentages do not include blank and invalid votes.[24][25]

Map showing the results of the referendum in each municipality.

  'Yes'-majority.

  'No'-majority.

  No referendum held.

Prior to, and a short while after, the election day it was not clear how big of an effect the results of the municipal referendums would have, especially for the referendums held in the municipalities other than Stockholm.

The Social Democratic government prior to the 2006 general election (cabinet Persson) stated that they would only take into consideration the results of the referendum held in Stockholm Municipality, while the opposition parties (Alliance for Sweden) stated that they would take into consideration the results of referendums the other municipalities as well if they won the election.

The opposition parties won the election and before they formed a government (cabinet Reinfeldt) their party leaders announced on October 1, 2006 to implement the congestion tax permanently, and that the revenue would go entirely to new road constructions in and around Stockholm instead of entirely to public transport in Stockholm as it was during the trial period.[5] The Riksdag approved the congestion tax on June 20, 2007, for reintroduction on August 1, 2007.[6]

The automatic number-plate recognition has its shortcomings. Number plates from Finland and Lithuania have a similar format compared to Swedish number plates, with three letters and three digits. The system can't see the difference, and a Swedish owner might falsely be charged.[29] Also stolen and forged plates have caused false payment demand on innocent people. All vehicles are photographed so people who notice the false charging and object will have the charge waived.