Environmental taxes for the EU?
opportunities and risks
Dr. Pendo Maro
EU Policy Officer, Environmental Policy Integration
European Environmental Bureau (EEB)
Financing the EU: where does, could and should the money come from? An NGO lunch debate
May 21, 2008
EU Civil Society Contact Group;
Social Platform
Brussels.
Structure of presentation
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Introduction: EEB, self
Introduction: environmental taxes
Examples in EU
Uses of revenues
Environmental tax reform
EEB’s work on environmental tax reform
Conclusion: tax for EU budget?
Introduction
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EEB: federation of over 145 environmental citizens’
organisations in EU 27, candidate countries and neighbours
Aim: to protect and improve EU’s environment, through
citizens by promoting environmental policy integration (EPI)
and sustainable (development) policies at EU level
Work: working groups of members, position papers,
representation at EU Commission, European Parliament and
Council
My work: EPI - integrating economic instruments into
environment policy, subsidy reform, indicator for societal
progress, following development of IA methodology, relevant
energy and transport dossiers; Lisbon National Reform
Programmes,…
Environmental taxes: introduction
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Definition: several, no formal agreement:
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General: taxes intended to promote ecologically sustainable
activities via economic incentives; with or without regulatory
approaches
Eurostat, 2001: a tax whose base is a physical unit … of
something that has a proven, specific negative impact on the
environment.
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But: No account of intention of tax, only what being taxed
Purpose: part of market-based instrument, used to
internalise external env costs; price signal stimulate
producers and consumers to limit env pressure, move
towards sustainable use of natural resources – promotes
‘Polluter Pays Principle’. Used as revenue generating tool
Environmental taxes and charges
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Energy taxes: Energy Tax Directive; sets min env tax rates for
fuels in all MS; Germany rise in petrol
CO2 taxes: no EU law; Member State e.g. Finland, Denmark,
Germany, NL, Estonia
Pollution: levy on NOX e.g. France, Italy, Sweden; SO2 levies e.g.
Denmark, Norway, Sweden
Agriculture: taxes/charges on pesticides e.g. Denmark, Norway,
Sweden; on fertilizers e.g. Denmark
Products: e.g. batteries in Belgium, Bulgaria, Lithuania,, Sweden
Waste: user charges in most MS; hazardous waste taxes: e.g.
Belgium, DK, France, Germany, Poland, Finland
Water: user charges in most MS
Other taxes –e.g. tax on electronic and electronic waste
E.g. Uses of revenues
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CO2/energy tax: general budget or reduce labour costs
e.g. Germany, NL, UK
NOX charge in Sweden: recycled to liable payers
Landfill tax revenues in France: recycled to
municipalities; in Austria funds clean-up of
contaminated sites; in UK used to reduce social
contributions and support environmental projects;
Norway to general budget
Batteries tax in Belgium: funds Belgian batteries
collection and recycling scheme
etc
Environmental Tax Reforms
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Emphasis is on shift of tax from ‘goods’ (e.g. labour,
etc) to ‘bads’ (e.g. Pollution, natural resource
degradation, etc)
Fiscal reform: includes removal of environmentally
harmful subsides
ETR in EU Germany, 1999-2003: tax shift from social
security contributions to energy; Sweden, 2001-2010:
from personal income tax and social security to env and
energy taxes, CO2 and SO2; Austria 2004: from
personal income and corporate tax to energy tax
EEB’s work on ETR
“Make the market work for the environment”
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Environmental Tax Reform since 2001: Campaign for
10% Tax Reform in 10 years - shifting taxation burden
away from welfare-negative taxes (e.g. labour) to energy
and natural resource use and pollution; environmental
harmful subsidy reform; tax neutrality
Objectives:
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Changing consumption and production patterns
towards greater sustainability
Raising awareness; promote effective EU-wide ETR
Conclusions:
Tax revenues for EU budget?
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Difficult to dictate to national govts what to do
with revenues, already used for diff purposes
At EU level taxation requires unanimity – main
obstacle to EU taxation
To counter unanimity: Open method of
coordination
Emphasis should be on tax shift and budget
neutrality, including off-setting negative social
effects of taxes