The Bundesrat or Federal Council, effectively the upper house of the German parliament, has passed a resolution calling for petrol and diesel powered cars to be banned by 2030.
According to Der Spiegel, the resolution calls for the EU Commision to "evaluate the past tax and duty practices of the [European] Member States on their effectiveness with regard to the promotion of emission-free mobility ... so that only emission-free passenger cars are permitted at the latest from 2030 onwards".
The call to evaluate the tax policy of EU member states is seen as a move to reduce or remove the financial incentive that benefit owners of diesel powered cars.
Figures from Global Petrol Prices show that in Germany petrol is priced at around 1.31 euros ($1.93) per litre, while diesel costs around 1.11 euros ($1.63) per litre. The price difference between petrol and diesel varies across the EU due to differing taxation arrangements in each country.
In figures released last week by the AID Newsletter, diesel's share of the European new car market has fallen sharply in the last year, and now stands at around 50 per cent.
The Bundesrat, which consists of representatives appointed by each of Germany's 16 state governments, can't initiate federal legislation and, even if it could, most automotive regulations are legislated at a European level.
Although the resolution is non-binding, Germany is the largest economy within the EU and is generally seen as setting Europe's legislative agenda.