Energy and Transport Sector Environmental Taxes for Tightening Environmental Policies: A Review on OECD Countries
DOI:
https://doi.org/10.15659/jancr.v8i2.197Keywords:
environmental policies, energy and transport, environmental taxes, environmental stringency index.Abstract
In OECD member countries, environmental taxes are defined as taxes on energy, transport/transportation, pollution and natural resources. Although they are divided into four parts, when the shares of these taxes in GDP are analyzed, it is seen that total environmental taxes are mainly composed of environmental taxes levied from the energy and transport sectors, while taxes on pollution and natural resources are at a very low level. In 2020, the share of taxes from the energy sector in total environmental taxes in Turkey was about 51 percent, while the share of taxes from the transportation sector was about 45 percent, the share of taxes on pollution was 2 per thousand and the share of taxes on natural resources was about 2.6 percent. In 2010, the share of the energy sector was 73 percent, the share of the transportation sector was about 26 percent, the share of taxes on pollution was about 2 percent and the share of taxes on natural resources was about 1 percent. In this study, the effects of environmental taxes on the energy and transportation sectors, which are determinants of the Environmental Policy Strictness (EPS) index for OECD countries, are analyzed with the Panel ARDL model. According to the findings, the main determinant of the EPS index in the long run is the taxes levied on the transportation sector. Accordingly, when environmental taxes on transportation sector increase by 1 percent, the EPS index value increases by 3.7 percent. Energy taxes, on the other hand, have a negative relationship with the environmental stringency index. In addition, the existence of a causality relationship between greenhouse gas emissions and transportation sector increases the importance of the sector in terms of environmental policies.
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