Mobility Budget in European Countries

Mobility budget: The future of corporate mobility?

Mobility budgets are the trend in Germany. More and more companies are offering their employees a flexible budget for sustainable transport options. But it is not only in Germany that companies are looking for innovative and attractive ways to become more sustainable, retain employees or bring them back to the office.

A look at other European countries shows: Germany can learn from other countries when it comes to mobility budgets.

What is the mobility budget?

The mobility budget is a benefit that companies make available to their employees for their individual mobility needs. In return, employees receive a monthly amount that can be used flexibly for private use or travelling to and from work. The amount of the budget can be determined individually by the company for each employee. Employees can choose freely between different modes of transport such as bus, train, car sharing or rental bikes. The choice of environmentally friendly alternatives such as local public transport can be encouraged through targeted tax optimisation or other financial benefits. Depending on the use case, billing can be digital in the form of smartphone or desktop applications or analogue via a type of mobility card.

A mobility budget is an offer for company employees that enables them to cover business and private journeys with alternative means of transport of their choice within an agreed budget instead of a personal company car.

What Germany can learn from other countries when it comes to mobility budget

German mobility budget providers are currently investing a lot of time and money in innovative solutions for companies and are developing comprehensive platforms to digitalise and simplify company mobility management. However, the legal framework is barely keeping pace with the market. The fragmented tax treatment of the mobility budget is a particular challenge.

Taking a look at how the mobility budget is implemented in other countries can help to avoid falling behind and to utilise the existing potential for a sustainable future of company mobility.

How is the mobility budget implemented in other European countries? A comparison.

According to the Arval Mobility Observatory's "Fleet Barometer 2023", 16 per cent of all large companies in Europe are already using mobility budgets, with a further 10 per cent planning to introduce them within three years.

The number of companies that will introduce a mobility budget will continue to increase over the next few years. This is because ESG reporting is becoming increasingly important. Companies must not only disclose data, but also increase their contribution to a more sustainable environment, society and economy. One challenge that many companies face is the mobility of their employees. It is difficult to measure and influence employee mobility. However, these hurdles can be overcome by implementing a mobility budget. Companies are also convinced of this, as 34 per cent of companies in Europe stated in the study that they would introduce a mobility budget for reasons related to the CSR Directive.

A mobility budget enables companies to collect data on their employees' mobility behaviour and incorporate it into their sustainability reporting. At the same time, it creates incentives for employees to use environmentally friendly modes of transport such as public transport, sharing services or electric vehicles.

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Legal and political support for mobility budgets and sustainable mobility

‍Many countries in Europe have begun to introduce political measures and legal regulations to promote sustainable mobility and support the implementation of mobility budgets. In which countries is the mobility budget already an issue?

These countries in Europe have sustainable transport initiatives

  • Austria
  • Belgium
  • Finland
  • France
  • Italy
  • The Netherlands
  • Portugal
  • United Kingdom


  • In Austria, too, mobility budgets offer tax advantages over the traditional vehicle fleet. Taxation here is also based on non-cash benefits, which results in lower tax.
  • Employers can grant their employees a tax-free job ticket. There are no restrictions and both route-only tickets and monthly or annual tickets can be issued as job tickets. The new Austria-wide Climate Ticket Ö is particularly suitable.
  • Until the end of 2022, it was not possible to claim the commuter allowance if employers provided a job ticket. This no longer applies from 2023. The commuter allowance will be reduced by the amount of the job ticket, but the entire commuter allowance will no longer be cancelled.
  • Austria also has a company bike scheme that is comparable to the model in Germany.
  • Employer subsidies for non-work-related journeys with emission-free car sharing or rental bikes are tax-free up to 200 euros per year.


Belgium is the most advanced country when it comes to mobility budgets. The mobility budget has been enshrined in law there since 2019. A revision of the law was implemented in 2022. One of the aims of this measure is to encourage employers and employees to use sustainable mobility instead of the company cars that are widely used in Belgium.

However, there is one restriction: employees can only receive the statutory mobility budget if they already have a company car or are eligible for one. If employees are not entitled to a company car, they cannot make use of the statutory mobility budget, but they can set up an individual, non-state mobility budget via a mobility budget provider. The only difference is that there is no tax exemption. Companies must therefore provide a benefit in kind for such a mobility budget.

For the employer, the statutory mobility budget is tax-free, but not exempt from social security contributions. They must provide a mobility budget of at least €3,000 per year. A maximum of one fifth of the gross salary or 16,000 euros per year is possible. In practice, employees can exchange their company car for a mobility budget, which they can use tax-free for various mobility options.

The framework conditions of the mobility budget are divided into three pillars: In the first pillar, employees can choose a more environmentally friendly vehicle instead of their current company car. In the second pillar, the part of the budget not utilised by a new, more environmentally friendly company car is used as a classic mobility budget.

The amount can be used for a variety of options. For example, for the purchase, hire or leasing of a bicycle, e-bike, moped or e-motorbike. It can also be used to purchase public transport tickets and season tickets (commuting and private journeys) as well as to cover the costs of car pools, car sharing solutions, taxi services and car hire.

A special feature of the Belgian model is that housing costs, i.e. rent and mortgage interest, are also covered for a home within a radius of 10 kilometres from the place of work. This is intended to promote short journeys to work in order to avoid emission-intensive commuting.

Under the third pillar, unused amounts are paid out to employees at the end of the year at favourable tax rates.

There is also one condition for the mobility budget: the introduction of the mobility budget requires consensus between the employer and employee. If one of the two parties wants to keep the company car, nothing changes and no mobility budget is made available.


To promote the mobility of commuters, Finland offers a range of additional benefits. These include:

  • Company bicycles: Employer-provided bicycles - employers can grant each employee an annual tax-free bicycle allowance of 1,200 euros. This benefit can also cover accessories (such as a helmet) as well as maintenance, repair and other operating costs. As a rule, the bicycles are leased by the employer (as part of long-term contracts with annual payments of 1,200 euros).
  • Tickets for public transport (ÖPNV): The employer can provide tax-free public transport tickets for journeys between home and work. The total tax-free value of bicycles and public transport tickets provided by the employer is subject to an annual cap of €3,400 (i.e. each bicycle benefit reduces the tax-free amount available for public transport tickets).
  • Tax benefits for electric and hybrid company cars: The taxable value of a company car is reduced if it is an electric or hybrid vehicle. Part of the reduction is limited in time and only applies until 2025. The reductions are higher for fully electric vehicles than for qualifying hybrid vehicles. Employers can also provide employees with electric company cars with a charger that they can use at home. However, the charger increases the taxable value of the company car. Until 2025, the electricity used to charge the company car at the workplace or at a public charging station provided by the employer is tax-free.


France, for example, offers tax exemptions for sustainable mobility. In May 2020, the French government introduced the "Forfait mobilités durables" package of measures for sustainable mobility in order to promote simpler, more economical and lower-carbon forms of mobility for commuting to work. As part of this package, employers can reimburse their employees up to 700 euros per year for the costs of personal mobility between home and work. The types of mobility eligible for reimbursement include e-bikes and conventional bicycles, car pools, non-subscription public transport and sharing services. The mobility package is available to all employees and can also be used in conjunction with other mobility support programmes, such as public transport subscriptions, up to a combined reimbursement limit of 800 euros.

The focus on promoting sustainable mobility options is particularly noteworthy. For example, the mobility package is higher if the employee is entitled to a company car but rejects the company car and opts for sustainable means of transport instead. There is also a higher subsidy for charging electric vehicles (700 euros) than for refuelling conventional combustion cars (max. 400 euros).

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The topic of sustainable company mobility is also being discussed in Italy, although there are currently no legal or tax regulations on mobility budgets. However, since the beginning of 2022, larger companies and the public administration in Italy have been obliged to draw up an annually updated action plan for commuting to work and appoint a mobility officer.

The Netherlands

In the Netherlands, the mobility budget is comparable to an employer allowance or a (tax-free) commuting allowance for journeys to work. This commuter allowance currently amounts to €0.21 per kilometre travelled. This amount will be increased to EUR 0.23 per kilometre in 2024. The use of public transport is tax-free, while a flat-rate tax of 30 per cent applies to the use of your own vehicle. This type of mobility budget is paid out as a gross salary. The tax-free lump sum does not apply to employers who offer their employees a company car or company bike.

For employees who mainly work from home, employers can alternatively pay a tax-free home office allowance.


To promote ESG measures, the Portuguese government has created incentives with a "cycle-to-work" programme to encourage more employees to cycle to work. Under this scheme, benefits in kind resulting from the provision of a bicycle (and cycling equipment) by an employer to an employee are exempt from income tax.

Portugal also promotes more environmentally friendly vehicles. For example, vehicles with lower emissions are subject to lower vehicle tax. Certain vehicle categories, e.g. 100% electric vehicles, can be exempt from vehicle tax. In addition to the registration tax exemption, companies that use electric vehicles can deduct certain expenses related to these vehicles. These include the cost of purchasing the vehicle, maintenance and the cost of charging infrastructure. From 1 January 2023, the costs of electric vehicles will be subject to autonomous taxation at a rate of 10% if the acquisition costs exceed EUR 62,500. Below this threshold, no autonomous tax will be levied.

A maximum amount of EUR 1,000 applies to the purchase of a bicycle by the employer and there is only one entitlement per employee over a period of five years. A salary sacrifice agreement is valid for a maximum period of 12 months and the employee does not have to pay taxes or duties for the salary sacrifice.

United Kingdom

In the United Kingdom, there is a travel allowance from the employer - comparable to Germany. This "travel allowance" is a voluntary employee benefit granted by the employer and is subject to general income tax. Some employees are entitled to tax relief, for example if the employer does not reimburse all travelling expenses.

The use of public transport is tax-free if the travel allowance is paid in addition to salary and not as deferred compensation.

For employees who cycle to work, there is the "Cycle to Work Scheme", which enables employees to purchase bicycles and cycling equipment through salary sacrifice or salary conversion, thereby saving tax and social security contributionsIn the UK, it is also still relatively common for employers to offer their employees the option of a company car for private use. From a tax and social security perspective, the private use of a company car is a non-cash benefit on which the employee is liable to pay income tax and the employer is liable to pay income tax. The amount of the benefit is multiplied by a certain percentage based on the gross list price, which depends on the CO2 emissions of the vehicle. The maximum percentage is currently 37 per cent. In order to encourage employees to opt for electric and certain hybrid vehicles with particularly low emissions, the specified percentage will be significantly reduced (down to two per cent). This ULEV (Ultra Low Emissions Vehicles) policy has proved extremely popular and the number of electric cars on UK roads has increased significantly as a result.

Electric cars and cycle to work benefits are often offered to employees via a salary sacrifice scheme, saving employees tax and social security contributions and employers social security contributions.

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Stefan Wendering
Stefan is a freelance author and editor at NAVIT. Previously, he worked for startups and in the mobility sphere. He is an expert in urban and sustainable mobility, employee benefits, and New Work. In addition to creating blog content, he also produces marketing materials, taglines, and website content, as well as case studies.
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