[TheDude]

Babeled

A common statement that you will hear some U.S. citizens say when the topic of high gas costs is broached is, “Europe still pays more than we do.” While this may be true in the absolute cost per gallon (3.8L) of gasoline, numbers can be used to deceive when not presented properly. As it turns out, the average cost of one gallon of gasoline in Europe is $8.70 as compared with the U.S. cost of $4.00 per gallon. This is a misleading figure because the components of the two different cost figures are drastically different.

In the U.S., about 11% of the final cost per gallon is from taxes. At the $4.00 per gallon average cost, this means that $0.44 is tax and $3.56 is the pretax cost per gallon. Europe’s prices, on the other hand, are comprised of 70% taxes and 30% pretax cost. Taxes on the $8.70 average per gallon cost are $6.09 and the pretax cost per gallon is $2.61. Wait, did you catch that? If you disregard taxes, Europeans pay $0.95 LESS than Americans for one gallon of gasoline.

Always been curious about this; if you factored in all the taxes in US paychecks into the gas price, what would it be?

[IanC]

This is a very important point to drive home. Yes, Europe pays a lot more at the pump, but they also GET a lot more. My understanding is that much of that 70% of tax goes toward other infrastructure and to subsidize non-auto transportation. Is this correct?

In the US, we just pay more for the privilage (inalienable right) of driving.

-Ian

[Peepers]

These comparison of what gas costs here vs. Europe are way too Ameri-centric. When these comparisons are made, they are usually "We pay $4 per gallon here but they pay $9 gallon there."

No they don't. They pay in pounds or euros. When they buy gas, they don't think about how much they'd be paying in dollars anymore than we Americans think about how much we'd be paying for our gas in pounds/euros.

What do they think? The same as us: how much gas costs in relation to other things. We pay $4 for a US gallon of gas? They pay £5 per US gallon (there's 3.78 litres in a US gallon). We pay $4 for a happy meal at McDonald's. They pay £4 for a happy meal at McDonald's. We pay about $4 for a stuffed potato. They pay £4 for a jacket potato (same thing). We pay $5 for a salad. They pay £5 for a salad.

Get the picture?

In other words, they're not paying all that much more for gas than we are. The only time we pay more than they do is when we visit UK/Europe and convert our lowly valued dollar for their currency. Instead, it's all about comparisons with how much other things cost in your daily lives.

[TheDude]

Well, in all probability it was written by an American for an American audience, what did you expect? Mostly was hoping someone has a cost breakdown of what goes into European fuel taxes. Other commodities are more elastic demand wise, Americans can learn to bake their own bread if it comes to that. And stop eating at Micky D's, that isn't food in the first place.

Found a little piece on Family food expenditures around the world. German family spends the most, then Yanks. Germans still enjoy beer and bottled water I see (was over for a month in '88, great time).

Also found this bit of Anglo-centric news about German prices:

Across the Rhine, things are much the same. Last year, Germans paid the equivalent of 80p for a litre of milk. Today, they will have little change left from £1. A loaf of bread has suddenly risen from £1 to £1.20.

$2.40 for a loaf? You can buy crappy bread in the States for that much maybe.

All over Europe food prices stay high

Would welcome a table comparing food prices as well.

[alokin]

If you fill your car it is greatly unimportant for you if you pay 10 or 70% in taxes - it's what you're paying which hurts you or not.
For the European fuel was always more expensive. The average car consumes less for this reason and I guess that the average European walks lots more.
There is only one thing you could compare: how many working hours needs an average worker for filling the car?

[Frank]

Factor in the cost of health care (or non-health care) here in the US and Europeans are getting a lot more value! They're a lifetime ahead of us in social programs (some here would argue that this is not good) but I think they're getting a better deal.

[hugh-wright]

Minimum wage for a 16-17 year old in the UK is £136 for a 40 hour week. Deductions (Income tax & N.I.) leaves about £110 : £2.75/hr.

So the lowest paid full time worker is working 1hr 37min. for a US gallon of unleaded; 1hr 52min for a US gallon of diesel, more or less.

Over 22 yrs old min. wage after deductions is about £4.50/hr : 1hr a gallon unleaded, 1hr 9min. diesel.

[Twilight]

Price of Petrol in the UK

Unleaded: 115.0p per litre

Diesel: 127.9p per litre

These are quite typical up to date figures. Stripping out the tax and converting into USD per US gallon at the current exchange rate quoted on BBC, we get:

Unleaded: $3.52

Diesel: $4.33

You can now add whatever taxes are applicable in your state.

I do not think the idea that Europeans have significantly cheaper underlying fuel prices stands up to scrutiny. If we did, the market would bring everything back into equilibrium (after shipping costs) via exports. Such is the market.

Nor do Europeans "pay more" for fuel by paying that tax. Unless you are really wealthy,* you get that tax back, along with much of the 20-40% income tax we pay depending on income and the 15% minimum VAT (17.5% here) in the form of services that people purchase over the counter with hard cash in the US. Such benefits include doctors and university, neither of which I have had to pay for directly.

* Top earners do not get as much value back as they put in. Such is taxation.

[hugh-wright]

Well....: go on then.

How long at the minimum wage in your locale to purchase a US gallon?

[Newfie]

Well, if I could figure out how to post a picture it would help.

Here is an article on what it costs in Europe with a table.

http://carscoop.blogspot.com/2008/04/eu ... t-350.html

Bulgaria $6.12
Ireland $7.21
UK $8.24
Netherlands $9.39

*Gas prices were taken on April 18, 2008 by Eurostat and they concern the average cost of one liter of Euro-Super 95 -taxes and duties included. For comparison reasons, we converted Euros/liter prices into Euros/gallon and Dollars/gallon. Note that the exchange rate between the Dollar and the Euro also hit a new record high today (€1 = $1.60 on April 22, 2008).

[hugh-wright]

Newfie: How long does someone have to work to buy a gallon of unleaded or diesel where you are?...assuming they are on minimum wage (if there is such a thing) or else whatever is notoriously ill paid: burger flipping perhaps?

[Newfie]

Newfie: How long does someone have to work to buy a gallon of unleaded or diesel where you are?...assuming they are on minimum wage (if there is such a thing) or else whatever is notoriously ill paid: burger flipping perhaps?

Thankfully I am no longer acquainted with minimum wage. I think it is somewhere between $6 and $7 bucks an hour. Assuming normal deductions I would guess about a a gallon an hour.

Why do you ask?

[mos6507]

The important thing is how many miles a typical american has to drive compared to a european. By that measure, most americans are "trapped" into buying more gas than the typical european.

[Dont_Panic]

Here, a very low-paid job (110 kroner/£10.8/$21.5/€13.9 hourly) will buy you 8.04 litres (2.12 gallons) of gasoline.

But that's a very low paid job. Most shop assistants make more than that.


(numbers are before tax, so should be adjusted down)

[Serial_Worrier]

Here, a very low-paid job (110 kroner/£10.8/$21.5/€13.9 hourly) will buy you 8.04 litres (2.12 gallons) of gasoline.

But that's a very low paid job. Most shop assistants make more than that.


(numbers are before tax, so should be adjusted down)

Welcome to the new economy, err the old one. Remember feudalism? We got along just fine for a 1000 years like that.

[TheDude]

Well, if I could figure out how to post a picture it would help.

Right click on image, "Copy Image Location" (in Firefox, dunno about IE etc.), click on button, paste URL of image, voila!

Thanks for all the commentary y'all.

[Newfie]

OK, got it. Thanks!



Earlier today, the AAA and Oil Price Information Service reported that average U.S. gasoline prices hit a new record at $3.50 per gallon. A lot of people are freaking out here in the U.S. with the cost of gas but how about if you paid more than double that like they do in Germany; how does that sound?

Ok, so we knew that Europeans pay an arm and a leg for gasoline – mostly due to heavy taxation, but we wanted to see exactly how much more so we “flew” over to Eurostat, the official European statistic office to find out. As you can see in the list, there are huge variations in Europe with gasoline prices ranging from “as low” as €3.82 / $6.12 a gallon in Bulgaria to as deep-space high as €5.87 / $9.39 in The Netherlands. Suddenly $3.50 doesn’t sound that bad, does it... And no, we’re not implying that we should pay more for gas.

*Gas prices were taken on April 18, 2008 by Eurostat and they concern the average cost of one liter of Euro-Super 95 -taxes and duties included. For comparison reasons, we converted Euros/liter prices into Euros/gallon and Dollars/gallon. Note that the exchange rate between the Dollar and the Euro also hit a new record high today (€1 = $1.60 on April 22, 2008).

[Twilight]

Yes, you have to bear in mind average incomes as well.

[Gerben]

I live in the Netherlands. The government will raise the tax on diesel on July 1st. We are used to high prices though. But those foreigners going on strike are making our truckers nervous. Also the bus drivers got all kinds of funny ideas. They also want those lower taxes. We can't have any of that nonsense here. I prefer good healthcare and stuff like that.

[hugh-wright]

Newfie: How long does someone have to work to buy a gallon of unleaded or diesel where you are?...assuming they are on minimum wage (if there is such a thing) or else whatever is notoriously ill paid: burger flipping perhaps?

Thankfully I am no longer acquainted with minimum wage. I think it is somewhere between $6 and $7 bucks an hour. Assuming normal deductions I would guess about a a gallon an hour.

Why do you ask?

my bold

In response to alokin's point.

The price of fuel only matters, at a personal level, in relation to your income.

I don't see how a like-for-like comparison can be made though: the percentage of income spent on transport fuel varies between countries but so do the other percentages: food, accomodation, domestic power & heat, taxes, etc

Within countries these also vary , mostly according to where you live in relation to the things in society that you want/need : shops, med. services, entertainment etc ...and the prevailing climate.

From reading this board it seems that the north of the US is extremely cold in winter, requiring large outlays for heating; the south extremely hot in summer, requiring large outlays for cooling.

Is there a happy mid-point where both energy costs can be mostly avoided, and if so: will the people in that region become systematically better off in relation to like-for-like incomes to north and south? (Due to avoiding excessive energy costs)