Macroeconomic effects of the promotion of biodiesel

The German energy tax law of 2006 introduced a tax on pure biodiesel, which will be increased from year to year. With a current taxation rate of 18.6 cent/litre, cost-covering sales are no longer ensured so that the markets have largely collapsed and existing production facilities are no longer operating to full capacity. The current political discussion is focussing on the problematic nature of an economically adequate taxation. This article examines the extent to which the economic contribution made by the value-added chain "biodiesel" contributes to offsetting the reduced tax revenues.