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Carbon Taxes EU

Carbon Taxes EU. Germany: Environmental Tax Reform: Carbon. German ETR: Five modest steps - first-time inclusion of electricity - road fuel tax increase biggest item Gasoline and diesel tax (already 50 cents per liter before the new laws):

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Carbon Taxes EU

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  1. Carbon Taxes EU

  2. Germany: Environmental Tax Reform: Carbon German ETR: Five modest steps - first-time inclusion of electricity - road fuel tax increase biggest item • Gasoline and diesel tax (already 50 cents per liter before the new laws): Annual increase of 3 Eurocents per Liter (for consumers, 3,5 cents incl. VAT, or 16 Eurocents per Gallon). • Electricity tax (first time in history): Annual increase of 2,6 Eurocents per kWh (3,2 Eurocents incl. VAT). • For electricity, gas and diesel: five price hikes from 1999 to 2003. • For light heating oil and natural gas, small tax increase only for 1999. • Industrial users pay only 60% of the normal rates for electricity, heating oil and natural gas. Similar exemptions for agriculture and rail traffic. • Additional exemption for energy-intensive industries ( was recently put in question by European Commission but finally accepted for next ten years). • Revenue from ecotaxes will add up to about 17 billion Euro in 2003 www.eco-tax.info Green Budget Reform: Lessons from Germany and Western Europe

  3. To prevent German industry from competitive disadvantages and for ecological and social reasons there are some exemptions. Here are the most important:  - Reduced rate of 20% (since 2003: 60%) for the manufacturing sector and forestry and agriculture, on condition that the basic amount of €511 per energy source (based on electricity and heating fuels) is exeeded. • Tax cap for manufacturing industry: as long as burden from increased tax rates is 1.2 times greater than the tax relief from the reduction in pension contributions, companies will be refunded 95% of the differential amount. • Public Transport enjoys a 50% reduced tax rate. • Combined heat and power plants with a utilisation rate of 70% or more are fully exempt from the existing mineral oil tax. • Highly efficient gas-steam power plants will have full exemption from the mineral oil tax as long as the fulfill certain conditions. • Electricity from renewable sources intended for the producer's own use is exempt from the electricity tax.

  4. German eco-tax creates jobs in renewable energy sector Förderverein Ökologische Steuerreform (FÖS)

  5. Environmental Effects of Ecotax Reform in Germany • Petrol consumption in first half of 2001 decreased by 12% compared to 1999, by 8% compared to 2000. Diesel consumption decreased by 2% in first half of 2001 compared to 1999. • Car-pool agencies reported a 25% growth in first half of 2000. • Environmentally sound gas-powered cars, three-litre consuming cars (90 miles per gallon), and renewable energies are booming. • Development of one-litre car (=280 miles per gallon) is near. • Number of rail passengers increased by 2% in 2000. • Germany world leader in wind energy, also in export of technology. • German Economics Research Institute (DIW) predicts 2-3% reduction in CO2 by 2005 as result of ecotax reform. • GERMANY'S ECOLOGICAL TAX REFORM (B) • Source: German Federal Ministry of the Environment, /www.bmu.de/english/fset1024.php • www.eco-tax.info Green Budet Reform : Lessos from Germany and Westonern Europe

  6. UK: Climate Change Levy • Started April 1, 2002 • Only for industry and public sector • Taxes electricity, gas, and coal • Expected to reduce the carbon dioxide emission from the UK by 10% in 2010 for those sectors included in the reform. • First post-assessment showed that British industry cut carbon dioxide releases into the atmosphere by 13.5 million tons in 2002, almost three times above target • Environmental Fiscal Reform:Perspectives for Progress in the European Union • AUTHOR: Christian Ege Jørgensen for the European Environmental Bureau

  7. The Netherlands • Cost of domestic electric and gas up 50%-70% due to new taxes. • Consumers use 15% less electric and 5%-10% less fuel. • High demand for renewable sources of energy as they are expempt from tax. • Environmental Fiscal Reform:Perspectives for Progress in the European Union • AUTHOR: Christian Ege Jørgensen for the European Environmental Bureau

  8. Denmark's Carbon Dioxide Tax. • Introduced in 1992 • The charges are twice as high for households as for businesses: $14.30 per ton of CO2 vs. $7.15. • Denmark offers refunds to energy intensive businesses. *For industries where the tax amounts to more than 3 percent of the value added, a total tax refund is possible. • permits such refunds only if "reasonable" energy efficiency investments are undertaken. • David Morris 1994

  9. Emissions credits for Industry • Emissions that exceed the emitter’s quota incurs a penalty of 40 Euro per ton CO2, rising to 100 Euro from 2007. • Allocation of emission credits will be free of charge • Size will be according to historical emissions • Could lose its ability to reduce emissions if EU Member States buy large amounts of emission rights from Russia and Ukraine • Environmental Fiscal Reform:Perspectives for Progress in the European Union • AUTHOR: Christian Ege Jørgensen for the European Environmental Bureau

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