This document provides an overview and highlights of the OECD's 2018 report on Taxing Energy Use. The report analyzes energy taxes across 42 countries and finds that:
1) Energy taxes differ strongly between countries, sectors, and fuels, but almost all taxes are too low. Coal is taxed at the lowest rates or fully untaxed despite its large environmental impact.
2) Outside of road transport, tax rates are below estimates of climate costs for 97% of emissions. Road fuel taxes are higher but still too low to account for other external costs like air pollution.
3) There were some increases in fuel taxes between 2012-2015, but changes outside of road transport were small. Progress on consistently applying the poll
2. CONTEXT
Tax and the environment
Taxing Energy Use
TAXING ENERGY USE
Highlights of the “Companion to the Taxing
Energy Use database”
Summing up
Q&A
TEU 2018 – Green Talk: Outline
2
Join the discussion on Twitter: #GreenTalks @OECD_ENV @OECDtax
3. Tax and the Environment at the OECD
Carbon
pricing
Other
environmental
taxes & tax
incentives
Country
work
3
Effective Carbon Rates,
Taxing Energy Use
Working papers on political
economy aspects and carbon
price design
Applying insights of
analytical work to country
contexts
(e.g. Mexico, Costa Rica, Slovenia)
Working papers on
“Diesel differential”,
“Company Car support”,
“Energy affordability”
Other analytical work
4. First released in 2013
with OECD country
profiles
Unique in its detail on tax rates
by sector and by fuel, presented
in the same way for all countries
for comparability.
Second report in 2015,
with profiles for 7 non-
OECD countries
Increasing coverage to 41
OECD and G20 economies
representing 80% of global
energy use.
Third report in 2018, with
updated profiles for 42
OECD and G20 economies
and comparison of 2012 and
2015 taxation patterns.
Intention
to update
regularly
Taxing Energy Use
4
2013 2015 2018
5. Today’s release:
Taxing Energy Use 2018
5
1. Report: Taxing Energy Use 2018
Companion to the Taxing Energy
Use Database
2. Country notes: graphical profiles
for every country available at
http://oe.cd/TEU2018
6. 6
Taxing Energy Use 2018 Highlights
Key findings for 2015
Energy taxes differ
strongly between
countries, sectors
and fuels, but almost
all taxes are too low
Despite its large
environmental
impact, coal is taxed
at the lowest rates,
or fully untaxed
Outside of road
transport, rates are
below a low-end
estimate of climate
costs for 97% of
emissions
Road fuel taxes are
higher, but too low
to account for other
external costs
(e.g. air pollution,
congestion)
Taxes tend to be
higher where GDP
per capita is higher,
but with some
notable exceptions
7. 7
Taxing Energy Use 2018 Highlights
Key findings for 2015
Fuel tax reforms in
some large
economies increased
the share of
emissions taxed
above climate costs
in road transport
Some countries are
removing lower tax
rates on diesel
compared to
gasoline
…progress towards more consistent application of the
‘polluter-pays’ principle remains slow
Despite some
encouraging
initiatives on a
country-level …
8. 8
Diagnosis for 2015: Zero or very low rates for the
majority of emissions
50% 97%
30
9. 9
Diagnosis for 2015: Large inter-country differences,
in and outside of road transport
17. Three cuts of the 2015 data – three messages for 2015:
1. Distribution of taxes on energy use: low taxes
2. Fuel averages by country: large differences by fuel and by
country
3. Profile by sector and fuel: large differences by sector
Comparing 2015 to 2012 – some but limited change
1. Comparing distributions – some change ‘in the middle’
2. Comparing at the country level – rising rates in some
countries
Taxing Energy Use 2018 - Summary
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18. Paris Collaborative on Green Budgeting
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• Launched at One Planet
Summit, 12 Dec 2017 in Paris
• Endorsed by France and
Mexico
• To be convened by OECD,
working in close partnership
with governments
Work towards alignment of
national budgetary processes with
the Paris Agreement and other
environmental goals.
19. RECENT AND FORTHCOMING PUBLICATIONS
Effective Carbon Rates (2016, 2018)
Working papers on political economy aspects (e.g.
incidence of energy taxes, affordability, competitiveness
impacts).
Working papers on carbon pricing design (e.g. permit
allocation and investment incentives, CIT and technology choice,
road transport taxation)
Country analysis (e.g. tax reform in Mexico, Costa Rica)
Tax and the environment at OECD
19
20. The next OECD Green Talks LIVE will discuss:
Leveraging the smart grid to optimise
energy consumption
Can providing real-time information help consumers to
reduce their environmental footprint?
15 March 5pm (Paris time)
Register at: bit.ly/OECDGreenTalks
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Thank you for joining us
#GreenTalks @OECD_ENV @OECDtax