The Effect of Vehicle Taxes on Fleet Exit

Markus Gehrsitz and Christian Traxler

No 12815, CESifo Working Paper Series from CESifo

Abstract: This paper studies how vehicle taxation shapes fleet exit. We exploit Germany's 2008/9 circulation tax reform, which generated a sharp discontinuity in annual tax liabilities at a registration cutoff date. Using administrative micro-data covering the universe of registered vehicles during the second half of 2008, we apply a difference-in-discontinuities design to estimate the effect of annual circulation taxes on permanent deregistrations. A 10 percent higher tax increases the share of deregistered vehicles after six years by about 2.8 percent. Duration analyses exploiting within-model variation in taxes yield closely consistent estimates. The effect seems to be mainly driven by exports rather than vehicle retirement.

Keywords: vehicle taxation; circulation tax; deregistrations (search for similar items in EconPapers)
JEL-codes: H23 Q58 R48 (search for similar items in EconPapers)
Date: 2026
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Working Paper: The Effect of Vehicle Taxes on Fleet Exit (2026)
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