The renewed EU Sustainable Development Strategy (2006) emphasizes the impact of market-based instruments in achieving prices; it also factors in damage to human health and environment. Environmentally-related taxes are one of the most important market-based environmental policy instruments and comprise taxes on energy consumption, transportation, pollution and the use of natural resources. Taxes on energy consumption constitute the largest share of all general government revenues from environmental taxes. In 2007, inflows from these taxes accounted for 2.5% of GDP in the EU as a whole and 3.0% of GDP in Slovenia. The share of environmental taxes in Slovenia has been dropping in recent years, amounting to 2.8% of GDP in 2008. The decline was mainly attributable to low taxation rates for automotive fuels in that period, when before Slovenia's entry to the euro area, the upward pressure of rising global prices of oil on inflation was buffered by lowering taxes on automotive fuels.
selected topics Slovenian Economic Mirror, January 2010 33 Selected Topics Environmental taxes and implicit tax rate taxes relative to GDP does not by itself reflect the implementation of environmental objectives, as it may on energy consumption (2007) be increasing due to greater use of natural resources and energy, which implies unfavourable structural changes The renewed EU Sustainable Development Strategy (2006) in the economy. Revenues may decline due to more emphasises the impact of market-based instruments in efficient use of energy and natural resources, or as a result achieving prices; it also factors in damage to human health of environmentally-oriented fiscal policy introducing and environment. Environmentally-related taxes are one of tax relief for more environmentally friendly products. the most important market-based environmental policy Similarly, the share of revenue from environmental instruments and comprise taxes on energy consumption, taxes relative to GDP may also drop as a consequence transportation, pollution and the use of natural resources. of lower registration fees on motor vehicles on account Taxes on energy consumption constitute the largest of higher tolls that are not regarded as tax revenue, or share (approx. three quarters) of all general government due to new environmental policy instruments, such as revenues from environmental taxes. emission trading, which substitutes the tax on energy of entities participating in emission-trading schemes. An In 2007, inflows from these taxes accounted for 2.5% of GDP indicator eliminating the shortfalls of the indicator of the in the EU as a whole and 3.0% of GDP in Slovenia. In the EU- share of revenue from environmental taxes is the implicit 15, this share was rising particularly in the early 1990s; in environmental tax rate. the new Member States, the increase occurred later and was related to the process of joining the EU. In 2007, the Among the implicit environmental tax rates, the implicit tax greatest share of environmental taxes relative to GDP rate on energy is an internationally comparable indicator,39 was recorded by Denmark (5.9%), which had by far the according to which Slovenia is ranked close to the EU greatest proportion of taxes on transport and pollution average.40 In 2007, taxation per unit of energy in Slovenia and use of natural resources. The latter two accounted for was higher than in all new EU countries, except Malta; in almost two thirds of all environmental taxes in Denmark, the EU-15, taxes on energy were lower than in Slovenia in while in the EU average, the share of taxes on
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