Green Fees From Environmental Protection To Taxation Restructuring Economics Essay

Research taxes in various countries that happen to be targeted at making people greener. Determine which taxes work and which do not, justification is necessary. What could Canada learn from other countries?

Green Taxes - Research taxes in several countries that happen to be targeted at making people greener. Determine which fees work and which do not, justification is necessary. What could Canada learn from other countries? (http://en. wikipedia. org/wiki/carbon_tax)

THESIS: Green fees started to be implemented with the aim of preventing people from damaging the surroundings however now the green fees are seen as part of restructuring of taxation.

Outline: I) Release II) Record of green tax reforms III) Types of Green Taxes or other plans imposed to lessen CO2 emission IV) Economic implications of renewable taxes in several countries: a)What kind of green fees does the US impose? b)What kind of Green Taxes do OECD & EU Countries impose? V) Green Fees within GDP VI) What are the effects of green fees on Canadians? VII) What could Canada study from other countries?


What is (Carbon) Green duty? Carbon or Green duty can be an environmental tax executed on the emission of Carbon Dioxide (CO2). By explanation Carbon Dioxide is a heattrapping "greenhouse" gas. The principal aim of green/carbon/environmental taxes is to lessen the emission of carbon dioxide. A Carbon/Green tax can be applied by taxing gas, coal, and petroleum products according with their carbon content. Green/carbon taxes may increase competition between lowcarbon systems and burning up of fossil fuels.

Different economic devices are playing a growing role in environmentally friendly plans of OECD countries including environmentally related (renewable/carbon) taxes. Nearly all OECD countries have unveiled environmental taxes in order to make the parties triggering pollution to cover the damage they are simply causing to the environment.

Nearly total amount of the earnings from green taxes or environmentally related fees generate from taxes on the purchase and/or use of motor vehicles and ingestion of energy. In the majority of the OECD countries the studies also show that there is real and growing proof on the positive effects of the environmental (inexperienced/carbon) fees.

This is an evidence that execution of green fees can help lowering the intake of energy and for that reason help to improve the environment. A couple of evidences that boosts or alterations on taxes or tax rates on energy products like gas, diesel may help people to turn from these energy sources to other energy options. Green tax reforms should be put in place so that could not create extra burden on tax payers. For example existing taxes can be restructured by fiscal procedures like exemptions, subsidies, etc.


Green taxes started to be implemented with the aim of protecting against or discouraging folks from causing damage to the surroundings and creating air pollution by making or forcing those to pay extra amounts of money in go back for using natural resources. This original aim of Green Tax Reforms continues to be valid but besides that renewable taxes have emerged by politicians as another period of taxes restructuring process which is currently referred to as "ecotax reform". The governments want to encourage not only positive environmentally development but also better monetary performance.

Green taxes can only make sense if indeed they tax "bad" instead of "good" from an economical, public and environmental point of view. According to some recent studies related to inexperienced tax reforms manufactured in the united kingdom, USA and Europe, if already existing fees on work, income and goods be replaced with taxes on energy use; this may have results on economic performances, increased degrees of employment and undoubtedly a far more clean environment.

Most of the critics about inexperienced taxes concentrate on the idea that poorer people will be negatively damaged more than the richer people since the increased duty on energy use related to household needs such as heating, cooking, lighting, etc. will create an extra burden on family members expenses. (http://en. wikipedia. org/wiki/Carbon_tax)


Direct Fees : They are the taxes immediately enforced on emission of CO2 and are far better and efficient. The application of direct taxes provides an incentive to polluters to reduce the volume of pollution they cause. Direct taxes are the most affordable since the polluters have the option to minimize or minimize their pollution, nor pay more taxes.

II) Indirect Taxes : Will be the taxes enforced on goods such as gasoline tax. A green tax enforced on goods like gas doesn't give any incentive to car owners to maintain pollution control equipments on their vehicles. With gasoline taxes they don't have other choice apart from driving less.

III) Tradeable permit strategies (Cap and Trade): That is supposed to be an alternative authorities policy to renewable taxes and is a cap on greenhouse gas emission. Under this system gas emission levels are capped whereas auctioning permits has significant financial benefits. Through these permits are given with regards to the level of allowable emission of CO2. Polluters who've to invest large amounts to use the procedures to reduce their emission may buy permits that are cheaper than investing in new or better technologies to lessen the emission rates and continue to pollute. These permits may be bought from the providers those have previously slice their emission at lower costs and which may have unused permits.

IV) Subsidies: Subsidies on the other palm will not actually result in reduced emission rate. On the other hand through subsidies the amount of the polluters may increase.


No green fees are virtually enforced by the US. In 1993 Chief executive Clinton suggested a BTU duty which would tax all types of fuel sources regarding to their warmth content except for solar, geothermal and wind based sources. This proposal was never adopted. To reduce air pollution two important benchmarks imposed in US are

1) (NSPS)CLIMATE ActNew Source Performance Criteria and

2) (CAFE)Corporate Average Fuel Economy. These are the expectations for automobiles. Besides these some inexperienced taxes are enforced at federal level such as fees on ozone depleting substances, fertilizers, pesticides, etc. At local levels some waste materials removal charges are applied by the municipalities.

These fees are either indirect or too low to have an impact on the individual actions. Most of the economists don't consider the current gas tax in the US as green duty since more than 80 % of the earnings generated through gas tax is used to subsidize highway construction which in return causes more pollution.

Also the existing federal gasoline taxes imposed is known as to be so low that it generally does not justify a green tax. (See Figure 1)* *(The Duty Insurance policy Briefing BookTaxes and the Environment/Taxes Policy CenterUrban Institute and Brookings Institution)

As and yes it is seen below (Number 2)* taxes on gasoline in the US make up significantly less of the full total cost of gas than far away. *(The Tax Coverage Briefing BookTaxes and the Environment/Taxes Coverage CenterUrban Institute and Brookings Organization)


In the OECD countries, since the starting of 1990's quite a number of new economic devices were introduced to safeguard the environment. Mainly those instruments were the introduction of new fees under the concept of "green duty reforms"; imposing taxes on energy, travel, emission of CO2, etc.

Such fiscal equipment were/are thought to supply the necessary and appropriate impulses into the market thus lessening the CO2 emission. In European union countries at the start of 1990's carbon/energy fees were suggested but had issues with the professional lobbies and didn't be executed. Finland was the 1st country to present carbon taxes in 1990. Finland accompanied by the Netherlands and Norway.

In 1991 Sweden enforced carbon tax on the utilization of olive oil, coal, gas, LPG, petroleum, gas and on industries using those energy sources. These fees were increased in 1997 and 20007. In Italy carbon taxes was released in 1998 regarding to Kyoto Ideas. The UK authorities started to use carbon fees by introducing petrol responsibility escalator (FDE) which can be an environmental duty on retail petroleum products.

The aim of FDE was to lessen the carbon emission triggered by the carry sector. The FDE which was the only real carbon tax carried out in the united kingdom was cancelled in 1999 anticipated to political issues. New Zealand proposed a carbon duty in 2005 that was planned and slated to be effective in April 2007. This duty was applied almost all economic areas. Methane emission from farming was exempted.

Also some carbon intense business were exempted from carbon taxes if they implemented the best expectations of practice regarding emission. Following a elections in 2005, the taxes was deserted in December 2005. Later, in 2008 emission trading program (capandtrade) passed as a legislation.


As discussed previously, Green duty reform has turned into a major policy issue in the OECD countries. Several countries such as Sweden, Denmark, the Netherlands, the United Kingdom, Finland, Norway, Germany and Italy all have executed explicit environmental taxes reforms. Green fees were seen as one of the ways of keeping pollution down by pricing it. Governments; beginning with 1990's established a primary website link between pollution and those who cause pollution, therefore applying green fees.

The green taxes are exercised either on fossil fuels to discourage the utilization or on waste materials disposal. Some of the countries increased VAT on petroleum and it's really by products, which increase is believed to have a revenue increase somewhat than environmental impact. Since a 10% upsurge in energy prices would only lower energy intake by 5 %. *

During the first stages of inexperienced taxes applications in OECD countries between 19941998 inexperienced tax levels as part of GDP increased in most of the country's GDP. Denmark's inexperienced taxes risen to 5 % of GDP whereas Turkey has doubled its green tax level through the same period. (http://www. oecdobserver. org/news/printpage. php/aid/497/green_taxes) *numbers extracted from (http://www. oecdobserver. org/news/printpage. php/aid/497/green_taxes)

Nearly all governments atlanta divorce attorneys country assume that carbon emissions and other pollutants should be taxed. While imposing green taxes some financial incentives should also be released to create attractive markets for environmentally acoustics products and process solutions. Many Europe have an extended custom with environmental taxes but the talk about of green taxes profits in the European union GDP is just a little declining. That is shocking since several governments had declared they would gradually transfer the fiscal burden from labour to pollution.

This demonstrates consumers either began to reduce fees they pay either turning to fuels that are less carbon extensive or by firmly taking actions to increase energy efficiency. But nonetheless on the other hand, in most instances, companies pass the expense of carbon price onto person: consumer. Studies, show that poor consumers spend a more substantial part of their income on energy intense goods and petrol.

Therefore cost boosts in energy impact the poor worse than the abundant. In this case, government rebates for use of energy conserving products becomes very important.


The effects of green taxes on Canadians aren't much different than the effects of green fees on other folks in several countries. If the government policies are applied within a wider restructuring of taxation this might not only create an environmentally development but also better financial performance. If the existing taxes on career, incomes and earnings are changed with taxes on energy use this can lead to an improved overall national economic performance.

A balance between the use of over used natural resources and under utilized human resources has to be created. Green fees have been completely levied in Canada for many years by individual provinces on some items like tires, used engine oil, bottles. Recently number of the things taxed started to increase and seems to increase in the coming years in advance.

Ontario & Quebec will be the two provinces that got implemented blue container recycling with waste fees over an accepted limit. English Columbia, Alberta, Quebec and Ontario have already proven programs regarding unsafe home items such as single use batteries, pesticides, fertilizers, antifreeze, car paint. Uk Columbia, Nova Scotia, Alberta and Saskatchewan impose a charge on electronic waste material. Quebec and English Columbia presented carbon fees on the emission of CO2. Quebec was the first province to put into practice carbon taxes.

British Columbia carbon taxes became effective in July 2008, this is a consumer taxes for the purchase of fossil fuels, temperature or energy options. Although such fees havent yet been enforced in other provinces, they may be being considered. It appears that the move towards renewable taxes in Canada does not seem to be always a shift from the current tax regime but instead seem to be to be additional taxes to be paid by individuals and companies.

When we look at renewable fees at an environmental perspective we can speak about a great deal of benefits for Canadians such as: a) Significant reduction of GARDEN GREENHOUSE Gas emission b) Development of clean industrial development + new job creation in related companies; development of new renewable technologies c) Substantive revenues made by the federal government to further subsidize or fund the reduced amount of CO2 emission and protect Canadians from the influences of increased prices credited to green taxes by potentially reducing other taxes d) Subsidies and advantages of environmentally producing businesses in all industries e) Provide financial benefits and rebates to individuals, companies, organizations to help them reduce their pollutant activities f) Improve quality of air to reduce hazards to health


It is evident that the inexperienced taxes aren't a switch from the current duty applications in Canada. Although carbon emission and other pollutants must have to be taxed a fresh tax regime to pay the burden of the new renewable taxes should be put in place. On individual basis, through education provided to consumer regarding the importance of the environment, a general popularity for the renewable taxes can be generated.

On the other hand, with businesses this will never be as easy as with the individuals. When green fees and fees are presented the price of conducting business and the expense of compliance with the new green rules will increase which in exchange be reflected in the consumer prices. All around the globe carbon taxes have been criticized to be unfair on certain interpersonal groups, like those with low income levels and moving into rural areas and the elderly people.

In Canada, general population transportation is not well toned compared to Europe and Canada is a very large country. People moving into the suburbs need to commute long distances every day. Therefore the execution of carbon fees will definitely put a supplementary burden on the individuals who are obliged to take gasoline.

In that case both provincial government authorities and the federal government have to find alternate ways to help the reduced amount of CO2 emission not only through imposing new taxes but also trough buying more on general population transport. Also new bonuses should be created to businesses to permit them to more concentrate on and invest in environmentally friendly systems.

As a realization we can say that, if the inexperienced taxes are successfully implemented, they will definitely decrease the damage of natural resources which in exchange decrease the earnings generated from renewable taxes. Government authorities when implementing green taxes shouldn't see and analyze it as an extra income. Individuals and companies need to pay the price tag on their activities but with the condition that the renewable taxes enforced be at genuine levels to echo the true cost.

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