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Environmental Taxes in Europe

Author: THOMAS STERNER AND GUNNAR KÖHLIN
Published in PFM, Vol. 3 No. 1

This paper provides an overview and a discussion of environmental
taxes in Europe. On the whole, most European countries have fairly high
levels of environmental taxation – at least compared to the US. This
appears broadly speaking to be true of both tax levels and tax revenues. It is
partly related to a greater reliance on taxes as an instrument of
environmental policy and partly due to a greater acceptance of taxes and
maybe a larger public sector overall. It may also be due to a more
ambitious goal when it comes to reductions in fossil energy use,
particularly for transportation. There is still considerable variation within
Europe when it comes to the level of taxation, the use of the revenues
collected and other issues.

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