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.infowww.eco-tax.info Green Budget Reform: Lessons from Germany and Western Europe
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.
German eco-tax creates jobs in renewable energy sector Förderverein Ökologische Steuerreform (FÖS)
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 Europewww.eco-tax.info
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
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
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
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