efr and the eu
play

EFR and the EU What is in the following understood by EFR and ETR - PowerPoint PPT Presentation


  1. �������� ���������� � �������� ���������� � �������� ��� ������� ����� �������� ��� ������� ����� ��� EFR – and the EU What is in the following understood by EFR and ETR EFR is the broader concept; it: What is politically feasible – what refers to a range of taxation and pricing measures which possibilities are there in the EU to can raise fiscal revenues while furthering environmental goals. implement EFR? – This includes taxes on natural resource exploitation or on pollution. – EFR can directly address environmental problems that threaten London the livelihoods and health of the poor. 17.7.2009 – EFR can also free up economic resources or generate revenues Alexander Wiedow that can help to finance access of the poor to water, sanitation European Commission and electricity services. (OECD 2005) The views expressed in this presentation are those of the author and may not in any circumstances be regarded as stating an official position of the European Commission 2 �������� ���������� � �������� ���������� � �������� ��� ������� ����� �������� ��� ������� ����� ��� ������������ ETR: • EFR/ETR are not objectives on their own (they are an is a reform of the national tax system where there is a shift of the burden of taxation from conventional taxes, opportunity, not a “must”) for example on labour, to environmentally damaging • Their feasibility very much depends on the necessity to activities, such as resource use or pollution. The burden of tax should fall more on ‘bads’ than ‘goods’ so that implement underlying policy concepts appropriate signals are given to consumers and • Which can consequently be primarily motivated producers and the tax burden across the economy are better distributed from a sustainable development – by economic or social objectives e.g. recent EU and national perspective. recovery plans show many parts of green elements (EEA 2005) – or by environmental goals – or by both at the same time (without an identifiable priority – e.g. French carbon tax debate to replace the ‘tax professionelle’) 3 4

  2. �������� ���������� � �������� ���������� � �������� ��� ������� ����� �������� ��� ������� ����� ��������������������� ������������������������ The key question appears to be nowadays: • Recovery plans only exceptionally include the design of environmental taxes (e.g. CO2 based car taxation) but rather rely on How to make the most of limited resources we have, debt financed fiscal expenditure being it natural resources or e.g. public finance? • Change the financing of social systems with ageing populations • EFR apparently would be a possible answer to that • EU-policy objectives of energy and climate change need to be reached and appropriate measures are to be implemented; these question in so far as we would raise money on may include revenue raiser: environmental harmful behaviour and reduce the costs of environmentally or economically beneficial behaviour; it – ETS should not matter whether we use taxes or other – Abolition of environmentally harmful subsidies revenue raising instruments (including abolition of – charges harmful subsidies) for environmental purposes. – Taxes 5 6 �������� ���������� � �������� ���������� � �������� ��� ������� ����� �������� ��� ������� ����� ��� ���������������������� • Ongoing Commission study to identify and assess environmentally harmful subsidies including case studies • Revenue raising of ETS was estimated in the IA at 0.5% relating to: of GDP annually – Transport: tax differentiation diesel vs petrol; • Was based on certain assumptions and notably on a company car taxation higher degree of auctioning than retained by the Council – Energy: Tax exemptions for biofuels; VAT reduction • ETS directive includes the idea of EFR as 50% of its revenues should be used for some predefined purposes for domestic energy; nuclear energy support (earmarking) – Water: irrigation water subsidies Most are aspects of tax differentiation ► ETR 7 8

  3. �������� ���������� � Taxes �������� ��� ������� ����� ���������������� Environmental taxes as % of total taxation in 1995 – 2007, EU-25 weighted and arithmetic averages 8,5 8,0 • Charges and fees are basically a consideration for either a service or the permission to use certain goods or facilities or resources (cost-recovery principle) 7,5 • No real revenue raiser for the general budget as they are 7,0 only meant to cover costs linked to the specific use (but allow to reduce public spending in a specific sector) 6,5 6,0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 EU-25 weighted average EU-25 arithmetic average 9 10 Source: Taxation trends in the European Union, 2009 edition. �������� ���������� � �������� ���������� � �������� ��� ������� ����� �������� ��� ������� ����� �� �� �� �� Figures need to be interpreted with care • They only show the relative importance (in relation to other tax • Ambitious environmental goals do create a case for receipts) more extensive use of environmental taxation (and – Especially in years of economic growth other consumption taxes and income taxes tend to grow much faster possibly higher share of environmental taxes in overall • Highest part of environmental taxes concerns taxes on energy taxation) products (largely motor fuels), some objective reasons for decrease in revenue: • Taxation instrument will particularly be needed to – Shift in consumption towards lower taxed diesel address – No systematic inflation correction so real value is not maintained over years – CO2 emissions of small installations excluded from ETS but that need to be made subject to ‘equivalent’ measures – shift in the transport area away from taxes to charges • Other environmental taxes often have a very limited tax base (e.g. – CO2 emissions of sectors outside ETS SO2 tax) that is unlikely to grow at the same rhythm as the economy – Overall energy efficiency 11 12

  4. �������� ���������� � �������� ���������� � !���������������������� #�����$���������$���� �������� ��� ������� ����� �������� ��� ������� ����� ����� �������� �����"��� ����� ������ No, because � Current EU legislation leaves room of manoeuvre for MS • Institutional rules will not change � Its concept based on minimum tax rates respects the • Unanimity is a difficulty as it needs more convincing of climate change approach to vary requirements according MS to relative wealth of MS • Convincing arguments rely on common goals and Yes, because objectives (which are defined at EU level for climate � The use of the tax instrument can be eased and made change) and thus on common needs more efficient for MS by streamlining the existing • Economic rational needs to be established: cost directive effectiveness of the instrument, well designed tax � the more the tax is harmonised the less fears of MS to loosing competitiveness 13 14 �������� ���������� � �������� ���������� � %��&������������������ �������� ��� ������� ����� �������� ��� ������� ����� �������������(�����(�� �����������'����"�� � • Even ETS did not succeed (and this was not a tax • Certain EU competence as regards taxation because of aiming at alimenting the budget) Internal Market effects and link to EU policies • Needs and opportunities are different from MS to MS • But no competence to prescribe how to spend the money – Effort sharing – no equal importance of revenues as tax levels will largely differ • General monitoring of Maastricht criteria with regard to – Social contributions in some countries already largely financed EURO-zone but not EU-wide (public deficit) through consumption taxes (limited need for additional funding) • No competence as to what tax structures MS should retain 15 16

Download Presentation
Download Policy: The content available on the website is offered to you 'AS IS' for your personal information and use only. It cannot be commercialized, licensed, or distributed on other websites without prior consent from the author. To download a presentation, simply click this link. If you encounter any difficulties during the download process, it's possible that the publisher has removed the file from their server.

Recommend


More recommend