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German motor vehicle tax & Emissions badges

German motor vehicle tax & Emissions badges

German motor vehicle tax & Emissions badges

Alongside paying for car insurance and biennial safety inspections, there are the costs of two environmental initiatives that drivers in Germany need to be aware of:

  • A compulsory motor vehicle tax (Kraftfahrzeug Steuer or Kfz-Steuer).
  • Emissions badges (Umweltplakette) that are required to enter environmental green zones (Umweltzonen) in certain German cities.

Motor vehicle tax (Kfz-Steuer)

Since July 1, 2009, all vehicles in Germany have been liable to pay a motor vehicle tax, based on engine size and carbon dioxide emissions. The income from this federal tax finances, among other things, road construction. 

How much is motor vehicle tax in Germany?

The calculation of motor vehicle tax is based on two main components:

  • CO2 emissions (two euros per gram per kilometre)
  • Engine size (two euros per 100cm3 for petrol engines and 9,50 euros per 100cm3 for diesel engines)

From January 1, 2021, new taxes will apply to newly-registered vehicles. Under the new Motor Vehicle Tax Act, owners of vehicles with high CO2 emissions will be taxed more heavily (up to 4 euros per gram per kilometre), while owners of climate-friendly cars will be rewarded with an annual tax bonus of 30 euros. 

To work out your tax liability, you can use this motor vehicle tax calculator (in German) from the Federal Ministry of Finance.

How do I pay German motor vehicle tax?

When you register your vehicle, you can specify that you want to pay your vehicle tax automatically via direct debit. Using a form known as a "SEPA direct debit mandate", you can provide your bank account details to the tax authority.

Once you have registered your car, you will automatically receive a tax liability notification from the main customs office (Hauptzollamt), that contains your tax number and a one-off tax assessment. It's a good idea to keep hold of this. 

If you agreed to a direct debit, your vehicle tax payment will then be automatically debited from your bank account as a lump sum. Vehicle tax in Germany is always paid one year in advance. If you haven't taken a direct debit, you need to transfer the money on time every year - you will not receive a reminder. Check with your local tax office (Finanzamt) if you are not sure.

Vehicle de-registration and tax rebate

If you sell your vehicle, export it, or de-register it (i.e. declare it off-road), you will be owed a reimbursement for the surplus tax you have paid. To receive this refund, you must make sure that either you or the buyer submits a notice of sale to the vehicle registration authority.

Changing your information

If your bank account information changes, you must inform the customs office as soon as possible by filling out and submitting a new SEPA direct debit mandate.

Exemptions from vehicle tax

Severely disabled people can receive a vehicle tax reduction of 50% or even receive an exemption from paying the tax. Owners of electric vehicles registered before December 31, 2025, are exempted from paying the tax until December 31, 2030.

Emissions badges (Umweltplakette)

In an effort to limit air pollution, several of Germany’s major cities have introduced environmental green zones (Umweltzonen). Every vehicle is assigned a badge (Umweltplakette) denoting how heavily polluting the vehicle is according to European emissions standards.

Only cars with a green sticker (diesel vehicles of Euro 4 or above and petrol vehicle at Euro 1 or above) can enter these protected zones. Most newer cars will qualify for a green sticker, but if your vehicle is more than 12 years old, it may not be allowed to enter emissions zones.

Where are the emissions zones?

The controlled zones are primarily located in major urban areas, including the cities of Berlin, Cologne, Munich and Stuttgart. You can see a full map of the areas here.

How do I get an emissions badge?

When you register your vehicle in Germany, you can also apply for an emissions badge. The cost is normally six euros. There are other authorities who can also issue emissions badges, including the vehicle registration office and safety testing authorities.

If your car is registered outside Germany, you still need an emissions badge to pass through protected zones. The cost of the badge may be slightly higher. There are several places to buy them online, but the cheapest ones can be found on the official state website of the area you are travelling to. You will need to submit a copy of your vehicle’s registration document and sometimes also your driving licence.

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