"The general gist of the proposal is that those taxes not environment-related, like the vehicle registration tax, should be transformed and replaced with road taxes and fuel taxes," says Tilman Lueder.
He said the EU executive would consult on the plan with governments, companies and other institutions until September 10 and then propose legislation. It would have to be approved in negotiations between governments and the European Parliament.
The registration tax and other fees vary across the 25-nation EU, resulting in different car costs and stifling free movement of goods - one of the bloc's principal rules.
Lueder said that as an interim solution, before the registration tax is scrapped, the Commission would propose a system to refund the levy if an owner moves with his car to another EU country.