VW pledges to pay customers' added tax on CO2

Auto giant VW asked the EU finance ministers to send the tax bill directly to the company and "not to our clients."

"The Volkswagen Group pledges to take charge of any possible additional taxes," the chief executive of the largest European carmaker, Matthias Müller, wrote in a letter to the EU officials published on Friday.

Müller also defended the company's response to the biggest scandal in its history, with management admitting to cheating in emissions tests for both nitrogen oxide and carbon dioxide. According to the company itself, some 800,000 cars were affected by a Volkswagen scheme to falsify CO2 tests in the laboratory.

While many observers accuse the management of reacting too slowly, the company's behavior is "due to the complexity of the issue," Müller wrote.

"Volkswagen will inform tax authorities in all countries of the correct CO2 levels as they become available," he added.

Emissions tests are important criteria for taxing cars in many countries, especially in Europe. VW has established a 24-hour multilingual advisory center for questions related to the latest scandal, Müller said in the letter.

No 'foundation' for cuts

Some analysts have claimed that the combined expenses of fines, lawsuits and vehicle refits could cost the auto giant dozens of billions of dollars.

Faced with the financial crisis, Volkswagen has announced a 1 billion euro ($1.07 billion) program of spending cuts.

However, the company's powerful workers council responded by demanding immediate talks with the management, signaling a possible rift inside the besieged automaker.

"Management is announcing savings measures unilaterally and without any foundation," works council chief Bernd Osterloh said in statement.

Volkswagen has lost nearly 40 percent in market capitalization since the scandal first broke in September.

dj/sms (Reuters, AFP, dpa)