The EEA briefing The role and importance of environmental taxation for supporting sustainability transitionsExamines the latest trends in taxes that relate to pollution, resource use, and greenhouse gas emission. It also considers the Potential of these taxesin generating revenues and supporting Europe’s sustainability goals.
Economists and politicians support the shift from labour taxes towards taxing activities that damage the environment or climate. This has been supported for a long time by economists as well as politicians. The EEA briefing notes that substantial increases in environmental tax revenues have not been realized, just as with the elimination of environmentally harmful subsidies.
In 2019, the EU’s environmental tax revenues were 330 billion euros The Share of environmental taxesThe total tax revenues fell from 6.6% in 2002 to 5.9% in 2019. This trend is not uniform across Europe, but it is important to note that the share of frontrunner countries implementing environmental taxes such as Denmark and Norway has declined, according to the EEA briefing notes.
The observed trends point out the problem of effective environmental taxes. Erosion of the tax baseLong-term. The EEA briefing concludes that the primary focus for environmental taxes should shift to revenue generation to support achieving the environment and climate goals.
