ACCA has produced a paper urging world governments to make a coordinated
strike on tackling climate change.
The institute, which released its paper on green taxation in a recession this
week, said unless global policies are put in place businesses could be enticed
to relocate to a country with less green taxation and will result in a loss of
The report added that environmental taxation could help boost falling tax
revenues, but will need careful planning by government and policy makers.
Chas Roy-Chowdhury, global head of taxation at ACCA, says: ‘We’re not
advocating tax hypothecation – where a tax is explicitly raised to fund the
development of a specific service.’
‘Green taxes need to be transparent and unambiguous so the public and
business understand what benefits are going to result for the potential pain
caused’ he added.
He continued: ‘Public trust in green tax systems is vital; government and
policy experts need to strike a balance between the need to raise revenues and
the environmental objective underpinning the policy. The trouble is, they’ll
The paper advises in order to reduce global green house gasses, international
green taxation policies are needed in order for any results to be achieved.
Roy-Chowdhury said that if there is no international implementation of global
green taxation policies, certain countries will be faced with competition issues
and businesses will relocate.
The paper offers five recommendations including: green taxation needs to be
implemented on a global scale; the results of taxation need to be measured and
analysed; consult with businesses before introducing taxes so that their
implementation is understood; explain the benefits of this type of taxation; and
make green taxation as transparent as possible.
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