Environmental Engineering Reference
In-Depth Information
This separation implies that energy products with zero emissions will be exempt from
paying the tax, which therefore provides an incentive for alternative energies. On the
other hand, a tax on energy content creates a clear signal in favour of saving energy.
The new proposal also includes the gradual phasing-out of subsidies that are not
justi
ed from an environmental viewpoint, and does away with the double taxation
in the case of the EU ETS mentioned above. It also includes a gradual increase until
2018 in all the minimum tax levels already described in the current Directive,
through most of the exemptions, reductions and exceptions contemplated in the
2003 Directive for special sectors (e.g. agriculture) and speci
c national or regional
situations are maintained.
Total environmental taxes in the European Union currently account for between
2 % and 3 % of the GDP of Member States, peaking at 4 % in Denmark and
Holland (followed by 3.4 % in Slovenia). In the case of Spain, France, Lithuania,
Romania and Slovakia, however, they remain below 2 %.
10
Energy taxes account
for most of this amount, but there are broad-ranging differences between countries,
as shown in the bar chart below. Denmark, Luxembourg
11
and some of the new
Member States
12
have the highest tax revenue. The countries with the lowest
income from energy taxes are Belgium, France, Ireland and, in last place, Spain. In
any case, it is important to note that in the case of the new Member States the high
tax revenue is not so much because of high taxation levels but rather because of
their high energy consumption. Thus, in a comparison of two countries with the
same GDPs but different levels of energy intensity the one with the higher intensity
would have a higher revenue/GDP ratio than the other, even if the latter has been
making more ef
cient use of its energy (Fig.
2
).
The bar chart above also reveals that transport appears to be subject to a con-
siderably higher tax burden than other energy sectors. This disparity is clearly
explained in the next section.
3.2 Proposals: Sending the Right Signal on an Economy-
Wide Basis
3.2.1 The Need for a Sectoral Approach
It is highly complex to analyse energy and environmental taxation on a sectoral
basis in a group of countries as broad and heterogeneous as those of the EU.
Oversimpli
cation could distort the general conclusions regarding the
scal pres-
sure to which consumers in each sector are subject.
10
Eurostat (2013), p. 41.
11
However, as explained in OECD [
24
], Luxembourg is biased in this regard because of its high
revenues from fuels for cars to be supplied to many non-residents.
12
Extensions from 2004 and 2007.
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