I. Title of the Best Practice
Environmental Taxation based on Carbon Content of Fossil Fuels
II. Overview of the Best Practice
A. Brief description of policy or measure:
The revenue are collected by means of an additional excise duty linked to carbon content of fuel
This duty is about 10 lire/kg CO2 to methane, 50 to all other liquid fuels to the carbon content of the fuels, reduced to 4 and 14 for electricity production.
The environmental tax has been combined with an actual tax revision that reduce impacts on industrial sectors.
Some sectors, steel and refineries, are partially exempted from the duty.
There is no increase in total taxation, a reduction of taxes on labor balances up to 90% of the duty collected, balance goes to some projects to reduce emissions.
B. Objective(s):
The policy aims at the substitutio of tax on labor with tax on energy, with the double divident effect: reduction of CO2 emissions and ease of unemployment.
C. Cost effectiveness:
No additional administrative costs
D. Performance indicator(s):
Scope studies with econometric models and tecnological bottom-up models to estimate the effect on the economy of this tax
E. Impacts (climate and other, incl. sustainanble development):
Reduction of CO2 emissions
Increase of taxation on non renewable energy fonts, reduction on an aboundant resource as labour.
F. Estimated reduction:
The measure should reduce total emissions of about 12-20 Mt CO2 by year 2010
III. Categorizing the Best Practice
1. Classifications
( X ) Regulatory approach
( ) Practical action
( ) Social network mechanism
2. Social actors involved :
( ) Citizens
( X ) Central Government
( ) Local Government
( ) Business
3. Sector(s)
( X ) Energy and transmission
( X ) Household
( X ) Transportation
( X ) Industrial enterprises
( ) Other (Non-Industrial) Business
( ) Agriculture/land use/forestry
( ) Other
4. Target greenhouse gas(es)
( X ) CO2
( ) CH4
( ) N2O
( ) HFC
( ) PFC
( ) SF6
( ) Other
IV. List of Attachments
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