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Tax Treatment of ETS Allowances: Options for Improving Transparency and Efficiency

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  • Copenhagen Economics

Abstract

The study examines current national practices with respect to emissions allowances in the EU and the countries with similar cap-and-trade systems. It analyses potential distortions resulting from national practices and identifies the best solutions. It deals with issues such as the tax treatment of allowances allocated for free, that of allowances originated as Clean Development Mechanism or Joint Implementation, and the tax treatment of penalties for non-compliance. It also examines the feasibility of various policy solutions at EU level.

Suggested Citation

  • Copenhagen Economics, 2010. "Tax Treatment of ETS Allowances: Options for Improving Transparency and Efficiency," Taxation Studies 0035, Directorate General Taxation and Customs Union, European Commission.
    • Handle: RePEc:tax:taxstu:0035
    as

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    File URL: https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/common/publications/studies/ets-report.pdf
    File Function: final version, 2010
    Download Restriction: no
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    References listed on IDEAS

    as
    1. Fankhauser, Samuel & Martin, Nat, 2010. "The economics of the CDM levy: Revenue potential, tax incidence and distortionary effects," Energy Policy, Elsevier, vol. 38(1), pages 357-363, January.
    2. Julien Chevallier, 2010. "Price relationships in the EU emissions trading system," Working Papers halshs-00458728, HAL.
    3. Christoph Böhringer & Henrike Koschel & Ulf Moslener, 2008. "Efficiency losses from overlapping regulation of EU carbon emissions," Journal of Regulatory Economics, Springer, vol. 33(3), pages 299-317, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    European Union; taxation; environmental tax; ETS;
    All these keywords.

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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