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Full Version - Issue 7 | November 2011 - LTA Academy

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Freight Tax Incentives in Japan<br />

In Japan, three types of taxes are imposed on<br />

freight vehicles:<br />

(i) A one-time vehicle acquisition tax<br />

(ii) An annual vehicle tonnage tax (based on<br />

weight)<br />

a vehicle’s operational efficiency through<br />

such measures as reducing speeding,<br />

minimising gear changing, and scheduling<br />

regular inspections. As a complementary<br />

measure, economies are urged to<br />

implement programmes aimed at raising<br />

the awareness of freight companies and<br />

drivers about the link between fuel-efficient<br />

driving practices and safe operations, as<br />

well as, the fact that saving 10 percent on<br />

fuel costs can increase a freight company’s<br />

bottom line by 15-35 percent.<br />

...economies are urged to implement<br />

programmes aimed at raising the<br />

awareness of freight companies and<br />

drivers about the link between fuelefficient<br />

driving practices and safe<br />

operations, as well as, the fact that<br />

saving 10 percent on fuel costs can<br />

increase a freight company’s bottom<br />

line by 15-35 percent.<br />

Policies to Encourage Transport<br />

System Efficiency<br />

• Reducing Road Congestion<br />

To mitigate road congestion, the workshop<br />

recommendations include implementing<br />

demand-centric measures to reduce<br />

Recommendations for Improving Transportation Energy Efficiency in APEC Economies<br />

(iii) An annual vehicle capacity tax (based on<br />

cargo capacity)<br />

To incentivise fuel efficient freight vehicles,<br />

Japan reduces the level of all three taxes for<br />

fuel-efficient vehicles.<br />

JOURNEYS | <strong>November</strong> <strong>2011</strong><br />

congestion on existing roads, before<br />

implementing supply-centric measures (e.g.,<br />

building more roads), since experience has<br />

shown that the addition of more roads does<br />

not alleviate congestion. Another strategy<br />

is to price parking in commercial business<br />

districts at a rate that prevents congestion<br />

due to “parking cruisers”. Studies have<br />

shown that the ideal price for parking may<br />

be one that ensures a 15 percent vacancy<br />

rate at any given time, so that vehicles<br />

looking for parking will not contribute to<br />

congestion and emissions by circling city<br />

blocks.<br />

...Studies have shown that the<br />

ideal price for parking may be one<br />

that ensures a 15 percent vacancy<br />

rate at any given time, so that<br />

vehicles looking for parking will<br />

not contribute to congestion and<br />

emissions by circling city blocks.<br />

Congestion pricing systems can also be<br />

extremely effective, particularly when<br />

they are designed to maximise congestion<br />

reduction rather than revenue generation.<br />

Charging for congestion rather than, or<br />

in addition to, car ownership enables<br />

policy to shape marginal behaviour,<br />

47

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