carbon tax - environmentally motivated energy taxes in scandinavian countries (sweden)

www.ees.uni.opole.pl ISSN paper version 1642-2597 ISSN electronic version 2081-8319 Economic and Environmental Studies

Vol. 10, No. 3 (15/2010),255-269., Sept. 2010

Correspondence Address: Michał Ptak, Wrocław University of Economics, Faculty of Regional Economics and Tourism in Jelenia Góra, ul. Nowowiejska 3, 58-500, Jelenia Góra, Poland. E-mail: [email protected]

© 2010 Opole University

Environmentally motivated energy taxes in

Scandinavian countries Michał PTAK Wrocław University of Economics, Poland Abstract: The article contains a review of energy taxes used in four Northern European countries (Denmark, Finland, Norway and Sweden) since the 1990s2000s. These countries pioneered the introduction of carbon taxes. Some of these taxes were used as parts of national environmental tax reforms. The author discusses environmental considerations in carbon-energy taxation schemes in the Nordic countries. Attention is also paid to the problem of simultaneous use of different climate policy instruments: energy taxes and the emissions trading scheme.

Keywords: environmental protection, energy taxes, Nordic countries, environmental tax reform

1. Introduction

Environmental taxes are economic instruments for environmental protection providing

financial incentives for economic actors to improve their environmental performance (Speck et

al., 2006: 19). Economic instruments, in particular environmental taxes, have the potential to

minimize the social cost of achieving environmental policy objectives (Wallart, 1999: 19).

Another advantage of these instruments is that they provide ongoing incentives for innovation in

pollution control.

„Green” taxes are raised from various products or activities that are harmful to the

environment (Buckley, 2003: 152). The most significant environmental taxes, in terms of

generated revenue, are energy taxes. They are levied on energy products for transport purposes

(motor fuels) and on energy products for domestic and industrial use (Eurostat, 2008: 408).

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All European countries use taxes (in particular excise duties) on various energy products.

Normally, the main purpose of these taxes is to generate revenue for the public sector. At the

same time, such energy taxes (due to relatively high rates) have some incentive effects, for

example encouraging the rational use of fossil fuels. Energy taxation schemes may be designed

more explicitly to achieve environmental policy objectives. Such environmentally-motivated

energy taxation schemes exist in particular in Northern European countries such as Denmark,

Finland, Norway and Sweden. It is interesting, that the Nordic countries use revenues from

energy taxes to reduce other taxes. Thus, energy taxes are components of environmental tax

reforms which involve partial replacement of “traditional” taxes by taxes with the objective of

improving the state of the environment (Wallart, 1999: 147). According to the double dividend

hypothesis such reforms could not only improve the quality of the environment but also improve

the functioning of the economy as a whole, in particularly leading to an increase in employment

(European Environmental Agency, 2005: 83-84).

The aim of the article is to present energy taxation schemes in the four Northern European

countries: Denmark, Finland, Norway and Sweden. The paper focuses on environmental

considerations in these taxes and experience in environmental tax reforms. Attention is also paid

to the issue of simultaneous use of two economic instruments addressing the same environmental

problems: energy taxes and the European Union Emissions Trading Scheme. The Nordic

countries avoided overlapping use of these instruments by reducing taxes for emission sources

that are included in the trading system (Lindhjem et al., 2009: 140).

Experience with energy taxes and environmental tax reforms in the Northern European

countries is of interest in Poland and other European countries. The experience may be used in

reforming national energy tax systems in order, e.g., to tackle climate change and air pollution.

2. Overall characteristics of energy taxation schemes in the Nordic countries

Table 1 presents information about energy tax revenues in the four analyzed countries in

2008 as well as indicators of the significance of the energy taxes. The data provided by the

Eurostat shows that Denmark and Sweden had the highest share of energy taxes in GDP.

Denmark’s and Sweden’s ratios quite significantly exceeded the EU-27 average (1.8%). The

highest shares of energy taxes in the total tax revenues are also found in those two countries.

ENVIRONMENTALLY MOTIVATED ENERGY TAXES IN SCANDINAVIAN COUNTRIES

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However, all of the four Nordic countries display a substantially lower share of energy taxes in

the total tax revenues than certain Central and Eastern European countries (inter alia Poland)1.

Table 1. Energy tax revenues, final energy consumption and the implicit tax rate on energy in Denmark, Finland, Norway and Sweden (2008)

Specification Denmark Finland Norway Sweden Energy tax revenues (in million of euro) 4923.4 3272.0 3807.4 7189.4 Energy taxes as % of GDP 2.1 1.8 1.2 2.2 Energy taxes as % of total taxation 4.4 4.1 2.9 4.7 Final energy consumption (in thousand tonnes of oil equivalent)

15545 25878 18894 32836

Nominal ITR on energy (in euro per tonne of oil equivalent) 316.7 126.4 201.5 218.9 Real ITR on energy (in euro per tonne of oil equivalent) 267.8 114.5 150.7 190.1

Source: own elaboration based on: Eurostat, 2010: 156-157, 358-359; the Eurostat database, [Online] Available at: http://epp.eurostat.ec.europa.eu/ [Accessed 28 February 2010].

The ratio of energy tax revenue to total taxation may be considered as a kind of indicator

of the role of energy taxes in the environmental policy. However, this indicator has in fact quite

limited information value and a number of drawbacks. For example, effective energy tax may

decrease energy consumption in a given country. In such case, the energy tax revenues may fall

(Eurostat, 2007: 112-113).

The data on energy tax revenues and final energy consumption allow to calculate an

implicit tax rate2 (ITR) on energy (the amount of energy taxes levied per unit of final energy

consumption). ITR on energy is more appropriate measure of the significance of energy taxes

than the share of energy taxes in the total tax revenues. However, it has also some drawbacks –

for example, ITR on energy treats equally all kinds of energy consumption, regardless of their

environmental impact (Eurostat, 2007: 112-113).

The data in Table 1 presents wide differences in the tax revenue raised per unit of energy

consumed in analyzed countries. In 2008 Denmark had the highest nominal ITR on energy (based

on nominal tax revenues) in the European Union. Denmark levied four times as much revenue

per unit of energy than the least taxing EU Member State (Romania) (Eurostat, 2007: 10; 2010:

156). Table 1 shows also the real ITR on energy which differs from the nominal ITR in the sense

1 In 2008 energy taxes in Poland represented 6.6 percent of the total tax revenues. The high share of excise duties in the total tax burden is treated in the literature as a favorable feature of the Polish tax system (see Samojlik, 2006: 71). 2 Implicit tax rates measure the average effective tax burden related to the potentially taxable base (European Communities, 2007: 62).

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that the nominal euro amount in the numerator of the ratio is deflated with the cumulative

percentage change in the final demand deflator from 2000 (Eurostat, 2009: 366).

The energy related taxation systems in the Nordic countries consist of different types of

taxes: excise duties, CO2 taxes and other taxes or fees3 (Table 2)4.

Table 2. Tax burden (in euro) on selected energy products in Denmark, Finland, Norway and Sweden (2008)

Fuel Unit Basic tax CO2 tax Other taxes

and fees Total taxation

Denmark Unleaded petrol 1000 l 521.7 30.0 – 551.7 Diesel oil 1000 l : : – 364.7 Light fuel oil 1000 l 253.5 33.1 – 286.7 Coal and coke 1000 kg 197.9 297.4 – 495.3 Electricity 1 MWh 78.7 11.8 – 90.5/81.6 a)

Finland Unleaded petrol b) 1000 l 572.2 47.8 7.2c) 627.2 Diesel oil b) 1000 l 306.7 53.8 3.9 c) 364.4 Light fuel oil 1000 l 29.4 54.1 3.9 c) 87.4 Coal and coke 1000 kg – 493.2 11.8 c) 505.0 Electricity 1 MWh – 2.5/8.7 a) 0.1 d) 2.6/8.8 a)

Norway Unleaded petrol 1000 l 563.3 106.7 : : Diesel oil 1000 l 422.3 71.5 : : Light fuel oil 1000 l : 71.5 : : Coal and coke 1000 kg : : : : Electricity 1 MWh : : : 14.1

Sweden Unleaded petrol b) 1000 l 320.9 254.5 – 575.4 Diesel oil b) 1000 l 138.9 313.6 – 452.5 Light fuel oil 1000 l 83.1 313.6 – 396.7 Coal and coke 1000 kg 35.3 272.9 – 308.2 Electricity 1 MWh 29.4 – – 29.4

a) The second rate applies to non-business use. b) Transportation fuels of the highest environmental class. c) Strategic stockpile fee and oil pollution fee. d) Strategic stockpile fee. Source: own elaboration based on: European Commission, 2008: 1-45; Swedish Tax Agency, 2008: 3-4; Lindhjem, et al., 2009: 25, 27, 40, 42, 64, 66, 70, 84-85; OECD, 2009: 147.

3 Energy products in all four countries are also subject to sulphur taxes. Those taxes are not included in the study, as the SO2 taxes are treated as pollution taxes rather than energy (product) taxes. 4 Tax rates for given year have been converted to euro using exchange rate as of first working day of October the previous year (according to the Directive 2003/96/EC restructuring the Community framework for the taxation of energy products and electricity). However, tax rates for the year 2003 and earlier years have been converted to euro using annual average exchange rates. The sources of the exchange rates are: Official Journal of the European Union and the Eurostat database.


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Excise duties on energy (basic taxes) can be treated as “traditional” taxes which are

primarily aimed at generating revenue. Such energy taxes (e.g., levied on motor fuels) exist in all

European countries.

Carbon taxes on energy carriers are levied with the objective of changing environmentally

damaging behavior rather than generating revenue (International Energy Agency, 2008: 24).

Carbon taxes can be defined as taxes levied in proportion to the carbon content of fossil fuels.

Because virtually all of the carbon in fossil fuels is ultimately emitted as CO2, a carbon tax is

equivalent to an emission tax (CO2 tax) levied on each unit of CO2-eqivalent emissions (Metz,

2007: 821).

Carbon taxes were implemented in the Nordic countries in the period 1990-1992 (Table

3). The main objective of those taxes was to reduce (or stabilize) CO2 emissions (Haugland,

1993: 7; Hoerner and Bosquet, 2001: 22). It is worth noting that the tax rates were not necessarily

based on the marginal external cost of CO2 emissions – for example in Denmark the tax rate

reflected some political and economic considerations (Hoerner and Bosquet, 2001: 11).

Table 3 presents evolution of the CO2 tax rates in the four analyzed Nordic countries in

recent years. Although the data are not complete, it can be noticed that in Denmark the standard

CO2 tax rate of 100 DKK was constant over 13 years (Speck and Jilkova, 2009: 31).

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Table 3. Development of the standard CO2 tax rates in Denmark, Finland, Norway and Sweden in recent years

Tax rate (per tonne of CO2) Country Year in national currency in euro

1992-2004 100 DKK 12.8-13.6 a) Denmark 2005 90 DKK 12.1 1990 6.7 FIM 1.2 1992 . 1.3 1993 14 FIM 2.4 1994 . 3.7 1995 . 6.4 1997 . 11.8

1998 (Jan. 1) 82 FIM 13.8 1998 (Sept. 1) 102 FIM 17.2

2003-2007 18.1 EUR 18.1

Finland

2008-2009 20 EUR 20 1991 97-269 NOK b) 12.1-33.6 b) Norway 2005 171-337 NOK b) 20.5-40.5 b)

1991-1992 250 SEK 33.2-33.4 1993 320 SEK 35.1

1994-1995 340 SEK 36.4-37.1 a) 1996-2000 370 SEK 41.5-44.0 a)

2001 530 SEK 57.3 2002 630 SEK 68.8 2003 760 SEK 83.3 2004 910 SEK 99,7 2005 920 SEK 101.9 2006 930 SEK 99.9

Sweden

2007 950 SEK 101.8 a) Depending on the exchange rate. b) The lowest rate applies to heavy fuel oil. The highest rate applies to petrol. Source: own elaboration based on: International Energy Agency, 2008: 24; Grafström, 2009: 42; Haugland, 1993: 7, 13-14, 22-24; Hoerner and Bosquet, 2001:17, 25; Lindhjem et al., 2009: 25, 39; Speck, et al. 2006: 62, 64, 100, 170.

All four analyzed Nordic countries have used taxes on electricity for many years (for

example, in Norway and Sweden taxes on electricity consumption were introduced in the early

1950s). Currently, under Directive 2003/96/EC electricity taxes must be applied in all EU

member states. This Directive also establishes minimum tax rates for electricity and for other

energy products (motor fuels, heating oils). It should be noticed, that energy taxes rates in the

Nordic countries are usually much higher than the minimum tax levels.

3. Environmental considerations in energy tax schemes

All kinds of energy taxes in the Nordic countries strengthen incentives to save energy by

increasing the price of fuels. Carbon taxes additionally induce switching to lower-carbon fuels.

Environmental policy objectives (such as elimination of polluting emissions, reduction in fossil


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fuel consumption) should also be achieved through tax exemptions or tax differentiations. In

2007 and 2008 such environmentally-motivated provisions in energy taxes included:

• A lower tax rate on electricity used for space heating in Denmark. The reduced energy tax

rate (0.07 euro per KWh5) applies to the share of the consumption above the 4000 kWh

(Ministry of Taxation, 2008: 40, 56). This exemption has been existing since 1986.

• Tax differentiations according to the sulphur content of the fuel or environmental class of the

fuel (Finland, Sweden) (European Commission, 2008: 10, 15). It is worth mentioning that in

the 1980s fuel taxes were also used to reduce the use of leaded petrol and to give consumers

an incentive to choose unleaded petrol (OECD, 2007: 127-128).

• Total exemption from electricity tax in Sweden for industries participating in the PFE

programme for improved energy efficiency. The aim of the programme is that the

improvements in energy efficiency should be equivalent to the improvements that would

otherwise have been achieved by the minimum levels of taxation prescribed in the

2003/96/EC Directive (Swedish Environmental Protection Agency, 2007: 13)6.

• A tax rebate in Denmark for fuels sold from stations with a vapour recovery system (in

existence since 1995). The aim of the rebate is to secure the best environmental technology at

petrol stations (OECD, 2007: 128).

• Exemptions in fuel and electricity taxes for biofuels (used in work machines or in heating)

and for electric rail traffic in Finland (Parkkinen, 2008: 3).

• Electricity tax refunds for wind power stations and for small water power stations in Finland

(Parkkinen, 2008: 3).

• A 50 per cent tax rebate (in CO2 tax) for natural gas in Finland (International Energy Agency,

2007: 24).

• Reduced electricity tax rates for Norwegian firms in the pulp and paper industry that

implemented approved energy-saving measures (Lindhjem et al., 2009: 63-64).

• A 85 per cent tax rebate (in CO2 tax) for fuels used in production of heat from combined heat

and power plants in Sweden (Lindhjem et al., 2009: 82).

There are also some tax provisions in the energy taxes used in the Nordic countries which

may be considered as environmentally-harmful. They include tax exemptions and reduced tax

5 The basic rate was 0.08 euro per 1 KWh (78.7 euro per MWh). 6 See Art. 17 of the 2003/96/EC Directive.

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rates for industrial energy users introduced in order to protect their international competitiveness

(OECD, 2007: 127). As a result of these provisions, the energy taxes in the Nordic countries are

not a cost-effective solution for the problem of pollution – from an economic efficiency point of

view every agent that causes pollution of the environment should pay the same tax rate. When the

tax rates are differentiated, marginal emission reduction costs (so called marginal abatement

costs) for each source are not equal. As the cost-effective reduction criterion is not met, the total

social cost of achieving the environmental objective is not minimized (Wallart, 1999: 132;

Thomas, Callan, 2006: 91-92).

Table 4 presents the payable share of CO2 tax in Denmark. As can be sees, the carbon

taxation scheme has not been relevant from an environmental point of view, since the heaviest

emitters faced the lowest tax rates. The scheme has been introduced to avoid relocation of

energy-intensive enterprises (in particular heavy industry) abroad (OECD, 2003: 133).

Table 4. Payable share (%) of CO2 tax in Denmark, 1996-2005 Sector 1996 1997 1998 1998 2000 2001 2002 2003 2004 2005

Households 100 100 100 100 100 100 100 100 100 100 Industry

Space heating 100 100 100 100 100 100 100 100 100 100 Light processesa) • Without voluntary agreement 50 60 70 80 90 90 90 90 90 100 • With voluntary agreement 50 50 50 58 68 68 68 68 68 76

Energy intensive processesb) • Without voluntary agreement 5 10 15 20 25 25 25 25 25 28 • With voluntary agreement 3 3 3 3 3 3 3 3 3 3

a) Lighting, office machines, etc. b) Processes in energy-intensive enterprises (e.g., energy that is used directly in the production of cement or glass, for the smelting of metals). Source: Hoerner and Bosquet, 2001: 13; OECD, 2007: 199.

The energy tax rates also differ greatly between different consumer groups in other three

countries. For example, in Sweden fuels used in some industrial processes are totally exempted

from the excise duty (International Energy Agency, 2008: 24). In Finland, there are two rates of

CO2 tax on electricity: the mining and manufacturing sector pay more than three times less than

other consumers such as households, services and agriculture (Parkkinen, 2009: 16). Electricity

used in the industry and mining sector is also subject to reduced tax rates in Norway (Lindhjem et

al., 2009: 63).

Environmental effectiveness of energy taxation schemes in the Nordic countries (and in

other European Union member states) is also limited due to the way in which electricity is taxed.


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Electricity taxes are revenue-raising taxes rather than incentive taxes, as they do not take into

account the environmental impact of different methods of electricity generation and different

fuels. The taxation of electricity at the end-user level is the option selected under the Directive

2003/96/EC. According to Art. 14 (a) of the Directive, energy products and electricity used to

produce electricity are exempted from excise taxation (Speck et al., 2006: 102, 239; Lindhjem et

al., 2009: 40-41).

There are some estimates of environmental effects of energy taxes used in the Nordic

countries. Analysis suggests that taxes havecaused lower energy-related emissions from industry

and households (see Vos et al., 1999: 92-93). For example, it has been estimated that carbon

dioxide emissions in Sweden in 2000 were at least 5 million tonnes lower than they would have

been without higher taxes on energy and CO2 emissions (OECD, 2004: 160). The tax also

boosted the use of bioenergy (European Environmental Agency, 2005: 93). The Swedish Institute

for Transport and Communications Analysis estimates that tax increases on fuels implemented in

the period 1990-2005 have reduced CO2 emissions from transport by 1.5 million tonnes to 3.2

million tonnes of carbon dioxide per year, mainly from passenger cars (The Budget Bill for 2008,

2007: 1).

Some of the analyses suggest that the level of CO2 taxes in the Nordic countries is too low

to internalize the external costs of emissions and to implement the polluter-pays principle. The

authors of 2003 Eurostat report “Energy Taxes in the Nordic Countries – Does the Polluter Pay?”

analyzed the ratio CO2 tax revenue to CO2 emissions in Denmark, Finland, Norway and Sweden.

Only in Sweden the average tax level (23 euro per tonne CO2) covered the estimated external

costs of CO2 emissions (Eurostat, 2003: 7, 24).

4. Energy taxes and the environmental tax reforms in the Nordic countries

Denmark, Finland, Norway and Sweden were among the first European countries to implement

environmental tax reforms by shifting taxes from labour (personal income or social security

contributions) to environmental degradation. Implementation of these reforms (which relied

mainly on carbon and energy taxes) began in the early 1990s. Numerous studies were carried out

in the Nordic countries to analyze and assess environmental and employment effects of “green”

tax reforms. In the mid 1990s some of these countries (Denmark, Norway and Sweden)

established interministerial committees or special commissions to make analyses and

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recommendations related to reforms (European Environmental Agency, 2005: 90-91).

Simulations carried out by the Norwegian Green Tax Commission suggested, for example, that in

long run environmental tax reform may (under certain conditions) generate in Norway positive

effect on employment (Majocchi, 2000: 14).

Implementations of the environmental tax reform concept (understood as the idea of

financing cuts in the labour taxation from increases in environmental taxation) in the analyzed

countries is shown in Figure 1. The figure presents changes in the ratio of taxes on labour and all

environmental taxes to GDP in 1995-2005. In Denmark and Norway a simultaneous decline in

the taxes on labour/GDP ratio and an increase in the environmental taxes/GDP ratio can be

observed. Such changes may be considered compatible with the concept of “greening” the tax

system. Another situation occurred in Finland and Sweden where the environmental taxes/GDP

ratio decreased slightly.

Figure 1. Change in the ratio of taxes on labour and environmental taxes to GDP in Denmark, Finland, Norway and Sweden, 1995-2005

-5

-4

-3

-2

-1

0

1

2

Denmark Finland Norway Sweden

Taxes on Labour/GDP

Environmental taxes/GDP

Source: author’s own elaboration based on: European Environmental Agency, 2005: 88; Eurostat, 2008: 276, 298; Eurostat, 2009: 294, 316.

Table 5 presents the development of ITR on labour, ITR on energy and energy intensity in

the analyzed countries in the years 1996-2006. These data may be used to assess whether the

changes in the country’s taxation systems are in line with the concept of environmental tax

reform and, to some limited extent, to assess the effects of energy taxes.


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Table 5. Development of ITR on labour, ITR on energy and energy intensity in Denmark, Finland, Norway and Sweden 1996-2006 (index 1996=100)a)

Specification 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Denmark ITR on labour 100.0 101.2 96.8 100.0 102.0 101.5 96.5 94.8 93.3 92.3 92.3 Real ITR on energy 100.0 100.2 113.3 129.2 134.5 136.7 139.7 138.8 136.8 130.9 126.5 Energy intensity of the economy 100.0 90.6 86.5 81.6 76.7 78.6 76.8 80.4 76.2 72.6 74.7

Finland ITR on labour 100.0 96.2 96.7 95.6 97.4 97.4 96.7 93.8 91.6 91.6 91.8 Real ITR on energy 100.0 109.6 106.2 111.7 106.7 108.9 109.7 108.7 108.4 109.4 103.3 Energy intensity of the economy 100.0 99.8 96.4 91.3 86.0 85.4 89.2 92.7 90.0 80.9 84.2

Norway ITR on labour : : : : : : 100.0 100.8 101.3 99.5 97.9 Real ITR on energy : : : : : : 100.0 95.1 80.8 85.6 85.0 Energy intensity of the economy : : : : : : 100.0 97.0 97.1 92.4 86.3

Sweden ITR on labour 100.0 100.8 102.9 101.0 98.3 96.3 93.3 93.1 93.1 93.8 92.7 Real ITR on energy 100.0 98.0 100.5 102.8 102.6 99.6 105.4 110.0 112.1 111.0 112.3 Energy intensity of the economy 100.0 95.2 92.5 87.8 79.9 84.8 82.3 79.9 79.9 76.0 71.0

a) For Norway: 2002-2006 (index 2002=100)a) Source: own elaboration based on: the Eurostat database, [Online] Available at: http://epp.eurostat.ec.europa.eu/ [Accessed 28 February 2010]; Eurostat, 2009: 79, 123.

The most noticeable changes took place in Denmark in 1996-2002. A significant increase

in ITR on energy and in energy efficiency maz be observed. The data suggest that taxation may

have played a role in stimulating energy conservation, alongside other structural factors and

environmental policy instruments (Eurostat, 2009: 123-124). Somewhat similar changes took

place in Sweden and Finland. In Norway there was a substantial decrease in the real tax burden

on energy (by 15 percent over 5 years).

The ITR on labour remained fairly stable in Norway. In the other three countries the tax

burden on labour declined in 2006 by around 7-8 per cent (compared to 1996).

5. Energy taxes and the EU Emissions Trading Scheme

An important issue in European Union is the problem of overlap between two economic

instruments for environmental protection: energy taxes (particularly CO2 taxes) and the EU

Emissions Trading Scheme (ETS), through which emitters are able to sell or buy CO2 emission

allowances (OECD, 2007: 127). The latter mechanism was launched by the EU member states in

January 2005. In 2005 Norway put in place an emissions trading scheme similar to the EU ETS

(though it had relatively limited coverage). For the second trading period (2008-2012) the

Norwegian system is linked with the EU ETS.

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The simultaneous use of energy taxes and the EU ETS may create double burden for some

industries. Denmark, Norway and Sweden have noticed this problem and have granted some

exemptions from carbon taxes to industries included in the emission trading systems. For

example, Sweden has reduced CO2 tax (for the use of some fuels) by 85 per cent (Lindhjem et al.,

2009: 26, 68, 81-82). Finnish authorities have not made major changes in the carbon taxation

system after the launch of the EU Emissions Trading Scheme. However, the government has in

turn lowered the electricity tax paid by industry and abolished tax on peat (Lindhjem et al., 2009:

44).

It is worth mentioning, that tax exemptions in Denmark and Sweden have been assessed

by the European Commission under state aid rules. The reason is that tax exemptions for

companies covered by the EU ETS could distort competition. It should be noted that most

emission allowances in the this system are currently allocated free of charge. The auctioning of

allowances will (progressively) replace free allocation from the start of the third trading period

2013-2020.

In 2005 the Danish government set up a special committee to examine how to solve the

problem of simultaneous use of the energy taxes and the Emissions Trading Scheme. In March

2007 the committee recommended abolishing the CO2 tax for industries included in the ETS,

while introducing a CO2 tax for non-ETS sectors. The tax rate should be equal to the expected

allowance price in 2008-2012 (DKK 150 per tonne) (OECD, 2007: 127, 163). This mechanism

would treat equally the non-ETS sectors and the ETS sectors. Thus, it would maintain symmetry

in the incentives (European Environmental Agency, 2005: 36). The authors of the OECD Report

for Finland state that from 2013 on, the CO2 tax in Finland should be progressively abolished for

the facilities included in the ETS. The tax should be extended to all sectors outside the EU

Emissions Trading Scheme. The rate of the tax should correspond to the price of CO2 allowances

(OECD, 2009: 146-147).

6. Concluding remarks

Energy taxation systems implemented in the Denmark, Finland, Norway and Sweden

consist of different types of energy-related taxes. These system are sometimes considered as

rather complicated and not entirely effective in meeting their fiscal and environmental goals


267

(International Energy Agency, 2006: 46; 2005: 46; 2008: 26; 2007: 127). However, it is very

likely that energy taxes have improved energy efficiency and reduced carbon dioxide emissions.

All four Nordic countries use various tax exemptions or tax differentiations to achieve

environmental policy objectives. There are many special tax provisions for industry introduced to

avoid the risk of loss of international competitiveness. These exemptions and reduced tax rates

may have a negative impact on the environment.

The Nordic countries’ experience with the use of energy taxes may be very instructive for

Poland. The Polish energy taxation scheme consists of excise duty for energy products, fuel

charge for motor fuels and air pollution charges, including charge on CO2 emissions (at a rate of

around 0.06 euro per tonne of CO2). This system can be expanded by adding a new carbon tax on

energy products such as motor fuels and heating fuels. The tax, according to recent trends, would

cover non EU-ETS sectors (including households which are generally not subject to emission

charges). The rate of the new tax should be reasonably higher than the rate of the currently used

charge on CO2 emissions.

The environmental tax reform may be seen as an attractive solution for environmental and

economic problems. However, introduction of such reform requires a wider analysis taking into

account the overall characteristics of the Polish tax system (including the current share of excise

duties in the total tax burden).

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System opodatkowania energii wynikający z pobudek środowiskowych w

krajachskandynawskich.

Streszczenie W artykule omówione zostały podatki energetyczne stosowane w czterech krajach Europy Północnej (Danii, Finlandii, Norwegii i Szwecji) w latach dziewięćdziesiątych XX wieku i pierwszej dekadzie obecnego stulecia. Kraje te były jednymi z pierwszych, w których wprowadzono podatki węglowe (czyli podatki od zawartości węgla w paliwie lub od emisji


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dwutlenku węgla powstających przy wykorzystaniu danego paliwa). Niektóre z tych podatków zostały wykorzystane w ramach ekologicznych reform podatkowych. W artykule omówione zostały proekologiczne rozwiązania proekologiczne w konstrukcji podatków od nośników energii w krajach nordyckich. Szczególną uwagę zwrócono na problem równoczesnego stosowania różnych instrumentów polityki zapobiegania zmianom klimatu: podatków energetycznych i systemu zbywalnych uprawnień emisyjnych. Słowa kluczowe: ochrona środowiska, podatki energetyczne, kraje nordyckie, ekologiczna reforma podatkowa.

carbon tax - environmentally motivated energy taxes in scandinavian countries (sweden)

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