Archived press release

Government still failing on green taxes, new figures reveal

3 December 2007

Green taxes, as a percentage of overall taxation, fell again in 2006, new Government figures reveal today. This is the fourth year in a row that the figure has fallen. Taxes from pollution now account for 7.3 % of total tax, compared with 9.4% in 1997 [1].

When Labour came to power it promised to "shift the burden of tax from `goods' to `bads'" [2], a commitment it has repeated every year - most recently last November [3]. Environmental Tax Reform - increasing the taxes on pollution and cutting taxes on people and jobs - has widespread support. A recent BMRN poll found 77% of the public supported green taxes, provided other taxes were reduced at the same time. Only 9% opposed the concept [4].

Friends of the Earth's economy campaigner Simon Bullock said:

"Yet again the Government has failed to deliver on its repeated promise to shift taxes off people and onto pollution. Increasing taxes on fossil fuels is an essential weapon in the Government's armoury for tackling climate change. And if Alistair Darling used these extra taxes to cut those on people and jobs, it would be extremely popular too. It's time the Treasury played its full part in delivering a low-carbon economy."

Notes

[1] Government Report Environmental Accounts Autumn 2007 published today:
www.statistics.gov.uk/downloads/theme_environment/EADec2007.pdf (PDF† )
Table 3.1

The figures announced today go as far as 2006. At Budget 2007, there was a modest increase in green taxes. This is likely to improve the percentage figure for 2007 and 2008. However, it is not clear that this is part of a long-term strategy on green taxes, rather than just a blip after many years of falling taxes. The dearth of announcements on green taxation in this Autumn's Pre-Budget Report, suggest that such a strategy is not in place.

[2] 1997 Treasury Statement of intent on environmental taxation.

`Over time, the Government will aim to reform the tax system to increase incentives to reduce environmental damage. That will shift the burden of tax from "goods" to "bads"'
www.hm-treasury.gov.uk./topics/environment/topics_environment_policy.cfm

[3] 2007 - Implementing the Stern Review, Section 4.12

"Over time, the Government aims to reform the tax system to increase incentives to reduce environmental damage, which would shift the burden of tax from `goods' to `bads',"
www.hm-treasury.gov.uk./media/A/B/pbr_csr07_stern770.pdf (PDF† ) , section 4.12

[4] http://greenfiscal.pmhclients.com/images/uploads/ ¬
GFCPressReleaseWEB12Nov2007.pdf (PDF† )

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Published by Friends of the Earth Trust