ASSESSING THE CORRELATION BETWEEN ENVIRONMENTAL TAXES
AND THE PUBLIC ENVIRONMENTAL MINDSET IN DAVAO CITY
An Undergraduate Thesis
Presented to the Faculty of the
College of Accounting Education
Name of Researchers
Antipasado, Keith Marian G.
Base, Alexis Jhoelle P.
Lismoras, Jane Rose S.
Adviser:
Myra T. Miraflores, CPA, MSA
September, 2023
1. INTRODUCTION
The Philippines, an archipelago in Southeast Asia that is famous for its natural
beauty, faces great environmental challenges including deforestation, pollution and the
effects of climate change. The environment is a precious resource that needs to be
managed responsibly. In reply to these challenges, there are a number of ways that
governments, corporations, and individuals can contribute to the care of the
environment. One of these ways is by implementing environmental taxes.
Environmental taxes on gasoline, electricity, water, and other types of pollution can
contribute to reducing environmental stress and the impact of human activity on the
environment, as well as providing incentives to move towards more sustainable
practices (Rao et al., 2023). Environmental taxes, also known as green taxes, are one
of the revenues that the government seeks that not only increase its revenue but would
help to preserve natural and precious environmental resources. This measure aims at
imposing taxes on all types of pollutants. Environmental taxes in the Philippines
include Taxes on Transportations, Tax on Energy, Air Pollution Tax, Tax on Water
Resources, Tax for the Biodiversity Services, Taxes on Waste Management, Tax on
Resources, and Tax on the use of Chemicals in Agriculture stated in the House Bill No.
6945. In conformity with Briefing EU policies – Insights, in practice, environmental
taxation aims to make market decisions more environmentally sensitive by weighting
environmental damage or negative externalities in prices. However, a certain degree of
public understanding and support is required for such taxes to be effective and widely
accepted.
In recent years, public environmental understanding and awareness have been
increasing around the world. According to a survey conducted by the Pew Research
Center (2020), over 78% of respondents in all countries viewed environmental
protection as a “very important” or top priority. Moreover, more than 85% of
respondents from all Member States agreed that the government should be doing more
to safeguard the environment. This survey exhibits some degree of public
understanding of environmental issues and suggests a favorable opinion of the notion
of environmental protection. On the other hand, (Hui, 2023), the power of an
environmental mindset cannot be understated. By relying on objective evidence to
support one's understanding of an object's nature, it will have the ability to impact an
individual's attitudes, beliefs, and behavior profoundly. By embracing this perspective,
it can foster a more effective and persuasive approach to environmentalism that benefits
both people and the Earth. According to Rebekah (2020), it's important to take action
now towards protecting the health of our planet. Additionally, she also talked about the
Green Mindset, which is a set of accepted attitudes or beliefs regarding the conversion
to an environmentally responsible lifestyle. Despite this favorable opinion of
environmental protection, environmental taxes remain unpopular and are often met
with resistance, both from individuals and companies. This resistance is primarily the
result of both the financial costs associated with the taxes and the perceived effect that
these taxes might have on the environment (OECD, 2011). Fears of “green taxes” being
used to increase the cost of living or as a way to increase taxes and government revenue
are also common among the public, which can influence their opinion on environmental
taxes.
While it is difficult to draw direct correlations between environmental taxes and
the public’s understanding of the environment, some research has pointed towards a
potential link. Local environmental taxes, if well-designed and implemented, can be
effective in raising public awareness about environmental issues and promoting
environmentally responsible behaviors. Environmental taxes can help to encourage the
public to become more environmentally conscious through their impact on financial
incentives. However, in order for environmental taxes to be effective, it is necessary to
allay the general public’s fears by providing clarification of the purpose and expected
effects of the tax, as well as to properly account for its cost and include public
engagement in the design and implementation of the tax. Therefore, it is crucial to
assess the correlation between environmental taxes and the public environmental
mindset in order to gauge the effectiveness of this approach in driving positive change.
In a world where human and the environment have come together, many
existing studies focus on the impact of environmental taxes on economic aspects, such
as tax revenue or industry compliance. While there is ample research on factors
influencing public environmental mindsets, there may be a gap in understanding how
specific policy measures, like environmental taxes, can impact and potentially shape
these mindsets. The proposed research addresses a gap by concentrating on the
correlation between environmental taxes and the public environmental mindset, which
is an area that has received comparatively less attention as well as an area that could
benefit from more comprehensive exploration in the context of environmental policy
and sustainability. Thus, the purpose of this paper is to assess the correlation between
environmental taxes and the public environmental mindset.
2. REVIEW OF RELATED LITERATURE
This chapter shall present a review of the relevant literature. In addition, a
review of the different documented studies and publications relevant for this research
work is conducted by means of various readings and investigations.
Pigouvian Tax Theory
The economic theory known as the "Pigouvian tax theory," which was named
after the British economist Arthur Pigou, proposes to use taxes on a market transaction
that creates negative externalities. A negative externality occurs when an economic
activity imposes costs on individuals not directly involved in the activity. By levying a
tax in these circumstances, it may be possible to recover some of the costs associated
with these externalities and "internalize" those costs into the price of the product stated
by the Tax Foundation (2023).
Environmental Psychology Theory
Environmental Psychology focuses on the relationship between individuals and
their environment. It takes into account how humans shape the natural world and the
built environment, and how that environment shapes us humans. People can find solace
in nature, it's common knowledge. The theory can inform the research by exploring
how environmental taxes impact perceptions, attitudes, and behaviors related to the
environment. The study can draw on motivational theories within environmental
psychology to understand what motivates individuals to engage in environmentally
responsible behaviors and how environmental taxes may serve as motivators or
disincentives (Diaz, 2022).
3. CONCEPTUAL FRAMEWORK
This study determines the Correlation between Environmental Taxes and the
Public Environmental Mindset in Davao City focusing the individual tax payers.
The conceptual framework showed two variables (see Fig. 1). The first variable
is the environmental taxes, including the tax knowledge, and burden concerns. The
second variable is public environmental mindset: Sustainability constraints,
Environmental crisis and Balance of nature.
ENVIRONMENTAL
TAXES
Tax Knowledge
Tax Burden
PUBLIC ENVIRONMENTAL
MINDSET
Sustainability Constraints
Environmental Crisis
Balance of Nature
Figure 1: Conceptual Framework of the Study
4. OBJECTIVE OF THE STUDY
The study aims to Assess the Correlation between Environmental Taxes and the
Public Environmental Mindset in Davao City.
5. METHODOLOGY
This chapter will indicate the research design, respondents, research instrument,
data gathering process, data analysis, and statistical tool of the study.
Research Design
The study will utilize a quantitative methodology and make use of a descriptive
correlational research design. Bhat (2018), descriptive correlational research is a
valuable tool for researchers seeking to explore the connection between multiple
variables. By analyzing data without making assumptions about cause and effect, this
technique allows for a deeper understanding of potential causal factors that contribute
to the relationship between variables. Through the collection and analysis of data on at
least two variables, researchers can gain valuable insights into complex relationships.
All in all, descriptive correlational research is a crucial research design that can provide
valuable insights into complex variables.
References
Amazon Web Services. (2020). House Bill No. 6945. [online] Available at:
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