The fiscal treatment of company cars in Belgium: effects on car demand, travel behaviour and external costs [ Working Paper 03-16 - 24/02/2016]

This paper seeks to understand how the current tax subsidy for the ownership and use of employer-provided cars influence behaviour by its recipients. We first seek to clarify how it affects the choice about cars, i.e. the number of cars a household owns, their engine size and their value. Second, we study the impact of the subsidy on the propensity to use a car for commuting and the number of kilometres driven for commuting and for other, private purposes. The analysis has been made on the basis of the BELDAM survey, a rich dataset on mobility behaviour in Belgium.