Transcript Group 2: Green Tax

GREEN TAX
經濟四
英文四
財二甲
財二甲
財二乙
陳彥蓉
高詩琴
呂宥儕
施純淨
陳碩耘
企三甲
企三甲
企三乙
企三乙
企三乙
黃瑞峯
王志源
劉時傑
邱士銘
蔡健宏
WHAT IS GREEN TAX?
Definition
→Green tax offers a means of tackling market
failures that arise when businesses and
consumers are not confronted with the full health
and environmental costs associated with their
activities
→Correct market failures

Other terms of Green Tax
→Environmental tax、Ecological tax (Ecotax)

HOW??
→Environmental charge can address market
failure by providing price signals that more
accurately reflect these costs

→Polluters incorporate these costs into their
decision-making process and product prices.
→Behavior affection
ANALYSIS OF GREEN TAX
Advantages
1. Encourage cost-effective emission reductions
2. Flexible
3. Revenue creation
4. Stimulate technological innovation
→Make the economy more efficient


1.
2.
Disadvantages
DO NOT guarantee a ceiling on the amount of
pollution released, just on the cost of pollution
control
Adequate only when emissions are relatively easy
to measure or monitor
EXAMPLES
Carbon levy
→A tax on fossil fuels based on their carbon
content
→Proportional to the amount of carbon dioxide
released when coal, oil and natural gas are
burned for energy
→Generate 8 billion to 38 billion per year (USD)
1.
EXAMPLES
2. Nitrogen fertilizer charge (氮肥料稅)
→
Farmers over apply fertilizer
→
Excess nitrogen ends up in coastal waterways
→Nutrient overloading and oxygen-depleted
→
“Dead Zone” occurs
→
Bottom-dwelling organisms die and fish are driven
away
→
Affect shrimp, crab, and oyster…
EXAMPLES
3. Environmental user fees
→
Taxes assessed on the use of or access to publicly
held resources
→
Ex: National forest entrance fees
DOUBLE DIVIDEND (雙重紅利)



Where do the benefits of green tax come from?
Pearce (1991): “ Environmental taxes might offer a socalled double dividend (DD).”
This idea received scant attention until the early
1990s when climate change policy attracted economists’
attention to the topic
1st
•Improvement in
Dividend the environment
2nd
Dividend
•Reduction in the
distortions of the
revenue-raising
tax system
From the aspect of labour market：
‧Impose green tax
‧ Shift the burden of taxation away from labour
to environment by cutting the existing labour tax
‧Working incentives of labours ↑
(income tax)
‧ Employment rate ↑
HOWEVER…..


Double Dividends are not necessarily positive
The problem is that other tax revenues may
decrease by more than the increase in tax
revenue through the environmental tax.
↑
Total Tax
Revenue
Originally
Green
Tax
Total Tax
Revenue
Other
Taxes
Ideally
↓
OR
Total Tax
Revenue
Green
Tax
Other
Taxes ↓
Practically ?
VALIDITY OF DOUBLE DIVIDEND



No consensus on any single test or experiment
that would validate or repudiate
Revenue-recycling effect vs. Tax-interaction effect
─Bovenberg & Mooij (1994)
Strong form vs. Weak form
─Goulder（1995）
GREEN TAX IN EUROPE-1

Definition of “Green Tax”


Taxes on air pollutant are common


Sulfur dioxide、Nitrogen dioxide
European Union:


Negative impact on the environment
Cap-and-trade
Composition of Green Tax revenue
Energy: 76%
 Transportation: 21%
 Pure pollutant tax: 3%



Proportion of Green Tax revenue to GDP: 3 %
Proportion of Green Tax revenue to Total revenue :
7%
CAP AND TRADE
 Goal
: To steadily reduce carbon dioxide
and other greenhouse gas emissions
economy-wide in a cost-effective manner.
 Cap
: Each large-scale emitter, or
company, will have a limit on the amount
of greenhouse gas that it can emit.
 Trade
: It will be relatively cheaper or
easier for some companies to reduce their
emissions below their required limit than
others
GREEN TAX IN EUROPE-2
GREEN TAX IN EUROPE-3
GREEN TAX IN UNITED STATES-1

Fewer Green Taxes than European countries

Green Tax at federal level:
Gas guzzler
 Ozone-depleting substance


Green Tax at State and Local level:

Pay-per-bag disposal charge
GREEN TAX IN UNITED STATES-2

Gasoline Tax:
Federal gasoline tax: 18.4 cents a gallon
 States add an average of 20 cents more


Is gasoline tax a green tax?

Proponents:


Reduce pollution and driving costs not borne by drivers
Opponents:

Over 80% of the revenue spent in road construction
GREEN TAX IN UNITED STATES-3
GREEN TAX IN TAIWAN
The Green Tax We Already Have Now
 The Green Tax Some Hope to Have in the Future
in 3 counties:
Yun Lin (雲林)
Hua Lian (花蓮)
Kao Xiong (高雄)

THE GREEN TAX WE ALREADY HAVE
Air pollution tax
 Started in 1995
 The Object
the immobile and mobile pollutant
 The Air Pollution Index
5 kinds: the nitrogen oxide, the sulfur dioxide,
the ozone, inspiratory suspended particle and
the carbon monoxide.
 The Taxation:
0.5-0.9 billion per season
 The Main Objects:
electric power industry (61%)
chemical manufacturing industry(8.5%)
the spin and weave industry (5.9%)
SO, WHERE DOES THE TAXATION GO?

60% of the money goes where the pollution is.
空污費來源
空污基金
中央政府
一綜固移庫空研護執一
般合定動更氣究計行般
行計污污新品規畫空建
政畫染染 質劃 氣築
源源 監
品及
管管 測
質設
制制 、
改備
資
善
料
維
地方政府
改執
善行
維空
護氣
計品
畫質
DRAFT TAXES
Proposed by: Kao Xiong, Hua Lian, Yu Lin
 Reason: pollution
 Method: impose tax on polluting firms
 Goal:



Decrease pollution
Increase government revenue
KAO XIONG
The Founder:
County bureau of public finance
 The Reason :
CO2 emission amount: 1st in the world
 The Object:
The firms which emit CO2 more than 10,000 ton a year
 The principle:
 Progressive taxation
CO2 emission amount < 2 million ton: $50/ ton
2~4 million ton: $ 60/ ton
> 4 million ton: $ 70/ ton
>10 million ton: $100/ ton

ASSESSED BENEFIT
2.88 billion NT
 And the taxation from CSC(中鋼)，CPC(中油)
and Taipower(台電) accounts to 2.8 billion NT.
e.g.
CSC:

21.78 million tons of C02 a year 1.7
billion NT
 Hua
Lian:
 1. > 10,000 ton: $50 per ton
 2. Assessed Benefit:
6 hundred million NT a year
 Yun Lin:
 1. > 100,000 ton: $100 per ton
> 200,000 ton: $ 200 per ton
 2. Assess Benefit: 9 billion NT a year
THE OBJECTION
From the labour union:
“Imposing green tax will block the development.”
 e.g. Taipower
If the draft passes, they will have to pay more
than 6 hundred million.

MAIN CONFLICTS
Should the carbon tax be levied by the central or local?
 Equity:
If the tax is levied by the central
 From the labour union:
It will block the development.

PROBLEMS AND SOLUTIONS
ON IMPOSING GREEN TAX-(1)
1. The Taiwan government has imposed environment tax
to increase tax revenue but improving the
environment should be the priority of green tax not
increased revenue.
→Ans: We can follow the examples of countries
which have been imposing green tax for years.
2. The public may think they are burdened with a new
tax, also imposing more tax may lead to inflation.
→Ans: Tax shifting
PROBLEMS ON IMPOSING GREEN
TAX-(2)
3. Imposing a green tax may bring a heavier burden on
those with low income.
→Ans: Governments should prevent double
taxation; or design appropriate compensation
plans to specific individuals or industry.
4. Imposing a green tax may have a negative effect on
the taxed good's industry which means that the
economy of the country might face recession or stop
growing in the long run.
→Ans: The Government should adopt experts'
suggestion in the domain of both public finance
and environment.
ex. Tax exemptions, reduced tax rates
5. It is difficult to legislate laws concerning green tax
because both the government and opposition party
may not want to impose a new tax due to political
reasons.
→Ans: Increase public awareness regarding
environmental issues; active involvement of
stakeholders; implemented gradually
CONCLUSION
REFERENCES (1) ─ACADEMIC
JOURNALS







Hanson, Craig (2006), “A Green Approach to Tax Reform”,
Issues in Science and Technology v. 22 no. 2 (Winter 2006) p. 25-7
Goulder, L. H., (1995), “Environmental Taxation and the
‘Double Dividend’: A Reader’s Guide.” International Tax and
Public Finance, August, 2 (2), pp. 157-83.
Schwartz, J. and Repetto, R (2002), “Nonseparable utility and
the double dividend debate” : reconsidering the taxinteraction effects. Environmental and Resource Economics 15,
149-157.
Barde Jean-Philippe (2004), “Green tax reforms in OECD
countries: An overview”
李涵茵 (2002) 。《從國外綠色租稅財政改革經驗看我國環境稅制之規
劃研究》，財團法人台灣綜合研究院
李涵茵 (2002) 。《環保就業、雙重紅利》，台灣綜合展望
陳鴻達（2001）。《綠色租稅改革-歐美環境稅的推動現況》，財稅研
究第33卷第4期，161-192
REFERENCES (2) ─WEBSITES
Tax Policy Center
http://www.taxpolicycenter.org/index.cfm
 環境資訊中心 http://e-info.org.tw/node/41567
 聯合報「高雄市碳稅徵收條例未過關」
http://udn.com/NEWS/NATIONAL/BREAKINGNW
S1/4928105.shtml
 自由時報「雲林縣欲徵碳稅 中央不准」
http://www.libertytimes.com.tw/2009/new/feb/21/to
day-life4.htm

Q&A