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Europe has stupid displacement taxes so they'll make some high strung 0.9L turbo 3/4cyl with all the technology that gets .01mpg better MPG than a ~2L engine while taking twice as much $$ in service to make it to any given milage.

IDK why they don't just tax the actual fuel used like the rest of the world (not that they don't do that).

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I'm not sure if displacement taxes still exist, but direct car taxes are fairly low in any case (like 200€ per year or so for an average car in Germany?). Most of the tax is paid through the fuel. The actual reason for downsizing (small turbo engines) is that they consume less fuel under light load, which is where car engines spend most of their time. It's not great for longevity though. Car engines had become more and more reliable over time apart from a few teething troubles of occasional new technologies, now some people say it's trending down due to downsizing.

In my country its based on emissions, 1.6l 4 cyl 140g/km co2 is ~150e, 3 litre V6 300g/km ~500e.

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