European fuel taxes "broadly stable"

OECD data shows ecological tax reform programmes have yet to bite in most countries

Data released by the Organisation for Economic Cooperation and Development (OECD) show that fuel taxes have remained fairly constant in most member countries over the last four years. The finding is drawn from the OECD's 2000 revenue statistics review published yesterday.

Measured as a proportion of all tax revenues, the data show that transport fuel tax revenue fell in 11 of the 22 OECD countries that separately identify them between 1996 and 1998, including in 7 out of 13 EU member states. There was some evidence of an upward shift in 1999, according to preliminary data (see table below). Fuel taxes account for the majority of environment-related taxation in OECD countries.

While absolute fuel tax revenues rose in most countries over the period covered, fuel taxes' share of total tax revenues did not, showing that European moves towards ecological tax reforms involving higher environmental taxes and lower labour taxes have still not had an impact. One exception is the UK, where a "fuel tax escalator" produced a sustained increase in the share of total tax revenues to 1999 when the policy was abolished (ENDS Daily 9 November 1999).

The statistics also reveal the extent to which the relative share of fuel taxes between countries reflect economic and political factors entirely outside environmental policy making. Within the EU, proportional fuel tax revenues were highest in Greece and Portugal, neither of which have explicit policies to increase the share of energy taxation, because these countries' GDP is lower than the EU average. Fuel taxation's contribution to total tax revenue was lowest in Sweden, despite its aggressive policy of raising fuel prices (ENDS Daily 21 September).

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Ratio of petroleum taxes to total taxes:
              1996    1997    1998    1999
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            - - EU states - -
Greece         8.8     7.7      -       -
Portugal       8.2     7.4     7.5      -
UK             6.3     6.4     6.7     6.9
Luxembourg     7.2     7.0     6.9     6.7
Ireland        5.3     5.3     5.3      -
Italy          4.7     4.3     5.1      -
Germany        5.1     4.9     4.8     4.9
Finland        4.6     4.7     4.8     4.7
France         4.1     4.1     4.1     4.0
Netherlands    3.0     3.5     3.5     3.5
Belgium        3.4     3.3     3.3      -
Austria        3.4     3.1     3.1     3.1
Denmark        2.8     2.6     2.6     2.7
Sweden         2.7     2.6     2.5     2.4
    - - Selected other countries - -
Switzerland    3.5     3.3     3.5     3.5
Norway         3.5     3.5     3.5     3.6
Czech Rep.     6.3     6.1     6.2     6.3
Hungary        6.1     6.6     7.6     7.5
Poland         2.6     2.5     3.2      -
USA            1.1     1.1     0.9      -
Japan          2.2     2.1     2.2     2.3
------------------------------------------
Source:  OECD
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Follow Up:
OECD, tel: +33 1 45 24 82 00; the report is entitled "Revenue Statistics 1965-1999, 2000 Edition". See also the OECD environmental taxes database.

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