Some frequently asked questions about environmentally related taxes, fees and charges

Why don't you focus only on levies introduced with an environmental purpose?

There are two main reasons for this:

First, regardless of the purpose -- or of the name -- of a levy, the environmental impact of a levy comes primarily through the impact it has on relative consumer and producer prices of environmentally related goods and services, in conjunction with the relevant price elasticities. For example, a tax on fuel oil introduced for purely fiscal reasons will have the same environmental impact as a tax on fuel oil introduced to combat CO2 emissions -- to the extent that the tax leads to similar changes in the prices of relevant tax-bases. The queries should provide a good starting point for analysing the impacts the levies can have on the prices facing various users of these tax-bases.

Second, it is often difficult to say what is the purpose of a particular levy. Many levies are introduced with several purposes in mind, and sometimes new purposes are added to existing levies, for instance in connection with changes in some of the rules governing the tax. In some cases, the "real" purpose of a levy might be different from what is publicly stated. Thus, to use "the purpose" as a criterion for which levies to include would introduce an important element of arbitrariness into the project.

Are the total revenue figures comparable between countries?

Yes and no. They are comparable insofar as they show in each case revenues raised on all pollution-orientated taxes levied on a given set of pollution-oriented tax-bases. The data concerning GDP and total tax revenues used to calculate the percentage shares in the graphs are taken from OECD's annual "Revenue Statistics" publications, while the (1995) population numbers used to calculate revenues per capita are taken from the UN.

However, the figures do not on their own provide sufficient information to judge the "environmental friendliness" of the tax systems in the countries concerned. For such analyses, a careful examination of the queries -- and of additional information describing the economic and taxation structure of each country -- is required.

It should also be kept in mind that revenues from fees and charges -- and from any levies related to resource management -- are not included in the graphs. In the queries, one can, however, find some information on fees and charges.