Environmental Taxes

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University Degree Physical Sciences

MFA456G                 INTERNATIONAL TAXATION

        

        Environmental taxes refer to the long-term economic, social and environmental gains and increase the incentives to protect the global environmental. (Australian Government Department of Environment and Heritage, 2005) [Online]. It is also known as tax shift, green tax reform and ecological taxing (Hanno Beck et.el, 1998) [Online]. The tax revenue collected from the people and business commercial are transfer into the inquisition policy tool that used to increase the quality of environment, reduce the demands and expenditure, increase more beneficial activities to society and welfare and promote the innovation (Hanno Beck et.el, 1998) [Online].

        

        Tax shift is a tool that with the intention of encouraging the sustainable activities and discouraging environmentally damaging behaviour and improve the overall the tax equity (Mainewatch Institute, no date) [Online]. The ideas are based on current economic trend, which fail to account the environmental damages because sending incorrect price signal, and the tax system creates counterproductive incentives (Mainewatch Institute, no date) [Online]. Tax shift are trying solution to reduce the level of taxes on production activities and increase the level of taxes on unproductive activities such as pollution, consumption product in order to promote the tax equity (Mainewatch Institute, no date) [Online].

Most of environmental taxes are designed to meet the objective of revenue neutral to raise revenue from new, untaxed or under taxed sources thus reduce the current taxes to yield the same dollar return to the government (Mainewatch Institute, no date) [Online]. The important of revenue neutrality is to identify the political resistance to generate revenue from the overall taxes to ensure the sufficient fund for the government program (Mainewatch Institute, no date) [Online]. The good tax system is predictability and stability with the built into tax shifting plans (Mainewatch Institute, no date) [Online]. It can be very challenging to predict the expected returns from the new forms of taxation, which introduce by the government and especially in estimating how much the incentives effects is needed thus reduce the revenue (Mainewatch Institute, no date) [Online]. Even though, the rational of tax shifting idea are important but it must included the tax equity, improve the quality of environmental and eco-efficiency (Mainewatch Institute, no date) [Online].

         Initially, objective of easy to avoid is encourage people convenience to change their behavior to protect the global environmental and successful of educate and public realize how the serious issues of the individual acts damages our share environment (Gemini Press, 2005) [Online].  For example, the government imposes the taxes on fuels to influence the demand of transport and encourage the people to drives less or share the public transport to reduce the level of pollution (Hanno Beck et.el, 1998) [Online].

Plastic Bags Taxes        

        

        Plastic shopping bags are major environment issue, which concern around the world (Zero Waste New Zealand Trust, 2002) [Online]. Before Ireland introduce the levy on plastic bag tax, the shopper are estimate used 1.2 million bag annually, roughly equally 325 bags per person  (Kris Christen 2002) [Online]. Because there are negative outcome such as waste the resources locked away in the million of plastic bag on landfill and serious issues of littering which impact on habitat and wildlife (Zero Waste New Zealand Trust, 2002) [Online]. Therefore the Ireland introduces the tax on plastic bags to reduce the usage of plastic bag and raising the public awareness of environment (Jim Sinner and Guy Salmon 2003) [Online]. The Irish charge 15 cents per bag which effective in March 2002, has attempted to change the behavior rather to raise the revenue (ACCA, 2002) [Online].

The purpose of the Ireland to introduce levy on plastic bag is to reduce the consumption of plastic bag dispended at retail outlets (The Department of Environment Heritage & Local Government, 2004) [Online]. The charge takes effective on entire sales outlet in Ireland (Jim Sinner and Guy Salmon, 2003) [Online]. The government introduced this tax policy to raising the public awareness to use reusable bag to cut down the litter problem and aims to reduce the number by 15-22 percent (ACCA, 2002) [Online].  The people who in charge in the outlet will be responsibility pass on the total amount of the levy as charges to the customer at the check out (The Department of Environment Heritage & Local Government, 2004) [Online]. However the tax is only applied on the plastic bag there are some exemption on the non-packaged product such as dairy product, fruit, vegetables of confectionery (Jim Sinner and Guy Salmon, 2003) [Online]

After few months, 90% of usage of plastic bag are successful reduce and netted more than more than €3.5 million national environment fund  (Kris Christen, 2002) [Online]. If the trend continues, the revenue are expected generate around to be €11 million in the first year  (Kris Christen, 2002) [Online]. The tax revenue collected from the plastic bag tax is going to Environment Fund to support the waste management project, litters and other environmental initiatives (ACCA, 2002) [Online].

        

Based on my analysis, I found out that Ireland introduce €15 cents per bag tax was huge successful to alter the behaviour of the consumer and raise the public awareness of the environmental (ACCA, 2002) [Online]. The consumer feel guilty to purchases the plastic bag, which cause the environmental damages (Jim Sinner and Guy Salmon 2003) [Online]. The levy is effectively to reduce the 90% of the consumption of plastic bag and save approximately 1 billion of plastic bag going to litter or landfill in the first few month (ACCA, 2002) [Online]. It indicates the Ireland successful alter behaviour of the consumer not to purchase the plastic bag. One of the large supermarkets Tesco in Ireland has used approximately 220 million plastic bags per year (Zero Waste New Zealand Trust, 2002) [Online]. Therefore Tesco has organized the programs ““Bag For Life” are effective to reduce approximately 40% usage of plastic bag and save around 88 million bags from the consumers (Zero Waste New Zealand Trust, 2002) [Online]. After my explanation, the program of Tesco introduced is also effectively to alter the behavior of the consumer to use reusable bag or by encouraging them to use another alternatives to carry their goods (Zero Waste New Zealand Trust, 2002) [Online].

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        In my analysis, Ireland adopted the concept of polluter pay principles to achieve the objective of revenue neutral to generate the fund to clean the environment (John Leaman, 2003) [Online]. The definition of polluter pay principle is assign the cost to those who pollute the environment for they damaged they have caused (Hanno Beck et.el, 1998) [Online]. The reason why I stated the Ireland adopt the concept of polluter pay principle because the shopper are liable to pay the tax €15 cents when they purchase the plastic bag at the check out (Jutexpo UK. 2003). The tax will stated ...

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Environmental Taxes
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