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Pass-through effects of a temporary tax rebate on German fuel prices

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  • Schmerer, Hans-Jörg
  • Hansen, Jaqueline

Abstract

This paper studies the impact of a recent tax rebate by the German government. In an attempt of reducing the economic burden of soaring energy prices, Germany lowered the tax on fuel by up to 35.9 cents for a limited period of time. Based on a diff-in-diff approach, we find a pass-through on consumer prices of up to 105 percent.

Suggested Citation

  • Schmerer, Hans-Jörg & Hansen, Jaqueline, 2023. "Pass-through effects of a temporary tax rebate on German fuel prices," Economics Letters, Elsevier, vol. 227(C).
    • Handle: RePEc:eee:ecolet:v:227:y:2023:i:c:s0165176523001295
    DOI: 10.1016/j.econlet.2023.111104
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    Cited by:

    1. Dovern, Jonas & Frank, Johannes & Glas, Alexander & Müller, Lena Sophia & Perico Ortiz, Daniel, 2023. "Estimating pass-through rates for the 2022 tax reduction on fuel prices in Germany," Energy Economics, Elsevier, vol. 126(C).
    2. Kruse-Becher, Robinson & Letixerant, Philip, 2025. "Oil price expectations in explosive phases," Energy Economics, Elsevier, vol. 152(C).
    3. Losert, Jakob & Paetzold, Jörg & Liebensteiner, Mario & Necker, Sarah & Neumeier, Florian & Wichert, Sebastian, 2024. "Almost Fare Free: Impact of a Public-Transport Climate Ticket on Mobility and Infrastructure Quality," VfS Annual Conference 2024 (Berlin): Upcoming Labor Market Challenges 302337, Verein für Socialpolitik / German Economic Association.
    4. Leonard Gregor & Justus Haucap, 2025. "The Rise of Refinery Margins: The Case of the Energy Tax Cut in Germany," CESifo Working Paper Series 12214, CESifo.
    5. Frederik von Waldow & Heike Link, 2024. "Spatial Competition and Pass-through of Fuel Taxes: Evidence from a Quasi-natural Experiment in Germany," Discussion Papers of DIW Berlin 2086, DIW Berlin, German Institute for Economic Research.
    6. Balaguer, Jacint & Ripollés, Jordi, 2024. "Assessing a fuel subsidy: Dynamic effects on retailer pricing and pass-through to consumers," Energy Economics, Elsevier, vol. 138(C).
    7. repec:ces:ceswps:_11229 is not listed on IDEAS
    8. Frondel, Manuel & Thiel, Patrick & Vance, Colin, 2024. "Heterogeneous pass-through over space and time: The case of Germany's fuel tax discount," Ruhr Economic Papers 1087, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    9. Drolsbach, Chiara Patricia & Gail, Maximilian Maurice & Klotz, Phil-Adrian, 2023. "Pass-through of temporary fuel tax reductions: Evidence from Europe," Energy Policy, Elsevier, vol. 183(C).
    10. Tsanko, Ilona, 2024. "Consumers' response to price increases: Evidence from gasoline markets," ZEW Discussion Papers 24-020, ZEW - Leibniz Centre for European Economic Research.
    11. Kahl, Mats Petter, 2024. "Was the German fuel discount passed on to consumers?," Energy Economics, Elsevier, vol. 138(C).
    12. Gregor, Leonard & Haucap, Justus, 2026. "Energy markets at war: The effect of the Russian invasion of Ukraine on refinery margins," DICE Discussion Papers 434, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).

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