Environmental Fiscal Reform and Fiscal Consolidation

Pereira, Alfredo; Pereira, Rui M.

doi:10.1177/1091142113485803

Cited by 17 publications

(2 citation statements)

References 31 publications

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“…We address this issue in the context of a multi-sector, multi-household dynamic computable general equilibrium model of the Portuguese. Previous versions of this model addressed several energy and climate policy issues (Pereira and Pereira (2014a, 2014b, 2017a, 2017b and Pereira et al (2016). The current version of the model has a detailed description of the tax system including energy taxation.…”

Section: Introductionmentioning

confidence: 99%

Picking Our Environmental Battles: Removal of Harmful Subsidies or Carbon Taxation?

Pereira¹,

Pereira²

2021

JEPF

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In this paper, we compare the effects of removing harmful fossil fuel subsidies with the replacement of the energy taxation by a carbon tax in Portugal. Since energy taxes focus on the energy content of the different energy products eliminating these provisions only brings their prices in line with their energy content. On the other hand, replacing the energy tax system with a tax on the emissions content of the energy products aligns the fossil fuel prices with their emissions content. We show that while replacing the energy with a carbon tax is a policy of a magnitude about eight times as large as the removal of the harmful subsidies, the effects of emissions are twenty times larger and the adverse economic and distributional effects only about twice as large. Accordingly, replacing the energy tax with a carbon tax is a much more cost-effective way of reducing emissions. This may suggest that focusing on the removal of harmful fossil fuel subsidies may be an environmental red herring.

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Section: Introductionmentioning

confidence: 99%

Picking Our Environmental Battles: Removal of Harmful Subsidies or Carbon Taxation?

Pereira¹,

Pereira²

2021

JEPF

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“…Despite this controversy over the "second dividend," some studies have gone further and point to the existence, in some countries, of a "third dividend". Thus, in recent years, in studies on developing countries, as well as in some countries with major problems of budgetary stability, has been identified another gain: "the reduction of poverty" or "the budgetary balance" (Heerden et al 2006;Pereira and Pereira 2014).…”

Section: Introductionmentioning

confidence: 99%

Green Taxation

Borrego¹,

Carreira²

2019

Encyclopedia of Sustainable Management

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Eco taxes; Environmental taxes; Green taxes; Pigouvian taxes Definition Green Taxation, also known as Environmental Taxation, involves the use of taxation to promote more responsible environmentally taxpayers' behavior, through tax penalties, in order to punish the polluting behavior, or tax benefits to encourage good behaviors. Definitions of this concept can also be found outside the scientific context, for instance, according to the Carbon Brief Staff (2013) this concept ". . .is commonly used to refer to a package of government measures intended to encourage expansion of low-carbon power, subsidise home insulation and tackle fuel poverty." Additionally, the United Kingdom Government (2012) states that "Environmental taxes are defined as those which meet all of the following three principles: (i) the tax is explicitly linked to the government's environmental objectives; (ii) the primary objective of the tax is to encourage environmentally positive behaviour change; (iii) the tax is structured in relation to environmental objectives, for example: the more polluting the behaviour, the greater the tax levied."Moreover, the concept of green taxation is inextricably linked with the concept of Green Tax Reform. This type of tax reform seeks to introduce environmental taxes, thereby replacing much of the traditional taxation on companies (income and capital), labor income, and contributions to social security systems, in order to reduce unemployment levels (Álvarez et al. 1998;Alves and Palma 2004). Thus, the Green Tax Reforms presuppose the obtaining of a double gain, denominated by effect of the "double dividend": the environmental gain and the reduction of unemployment, by tax relief on labor.

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Regulated Early Closures of Coal-Fired Power Plants and Tougher Energy Taxation on Electricity Production: Synergy or Rivalry?

Pereira

2020

Economic Globalization and Governance

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This article examines the economic, budgetary, distributional and environmental impacts of the interaction between regulated early closure of coal-fired power plants and new energy taxation rules on fossil fuel-operated power plants using a multi-sector and multi-household dynamic general equilibrium model of the Portuguese economy. Simulation results show first that regulated early closures will lead to meaningful reductions in emissions. They will also induce significant detrimental macroeconomic and distributional effects. Second, when the new energy taxation rules are applied to the coal-operated power plants no significant environmental gains or macroeconomic or distributional losses are observed in addition to what already induced by the forced closures. Only the public sector seems to benefit in the form of additional tax revenues. A different situation occurs, however, if the operators of the coal-fired power plants react to the new energy taxes levied on them by unilaterally deciding to decommission their installations. In this case, although the environmental effects will improve, the adverse macroeconomic and distributional effects will substantially deteriorate. Noticeably, the adverse budgetary effects will also be substantially larger. Overall, we find no synergies between the two policies and, actually, the potential for the opposite to be true.

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Environmental Fiscal Reform and Fiscal Consolidation

Cited by 17 publications

References 31 publications

Picking Our Environmental Battles: Removal of Harmful Subsidies or Carbon Taxation?

Picking Our Environmental Battles: Removal of Harmful Subsidies or Carbon Taxation?

Green Taxation

Regulated Early Closures of Coal-Fired Power Plants and Tougher Energy Taxation on Electricity Production: Synergy or Rivalry?

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