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Brussels, 18/09/2001
EURO COOP SUPPORTS THE USE OF ENVIRONMENTAL TAXES
Euro Coop is the European Community of Consumer Co-operatives, whose members are the national organisations of consumer co-operatives in 11 of the 15 Member States of the EU and in 4 Central and Eastern European countries. Created in 1957, Euro Coop today represents over 3,200 local or regional co-operatives, membership of which amounts to over 19 million consumers in the EU and 2 million in the associated countries of Central and Eastern Europe.
Euro Coop welcomes the European Commission's Communication on: "Bringing our Needs and Responsibilities Together and Integrating Environmental Issues with Economic Policy (COM (2000) 576)". It is a useful attempt to map out a direction, which the EU should take in a particularly complex area.
Euro Coop believes that environmental taxes can be a useful addition to the measures that the European Union can take to promote sustainable development, limit environmental damage and to preserve and improve the environment for the future. Euro Coop does, however, recognise that appropriate environmental legislation backed up by adequate enforcement measures will still be necessary to protect the environment. Therefore, environmental taxes should not be seen as a replacement for environmental legislation - both have their place.
Euro Coop recognises that it has been difficult to make progress on EU wide taxes at a European level at present because many Member States wish for decisions and fiscal policies to be taken at national rather than at EU level. Even though, environmental pollution is, in many instances, a cross border issue, therefore, if environmental taxes are to be implemented, we should prefer for those taxes to be introduced at an EU level to ensure consistency for consumers.
In general, Euro Coop favours a shift to taxation of activities that deplete natural resources or pollute the environment. In this way, environmental taxes can support 'the Polluter (or User) Pays' principle. However, there is a need to ensure that in any such change that the taxation burden does not fall disproportionately onto poorer consumers. For example, increased taxes on certain fuels will affect poor consumers more unless they are compensated in some other way. There is potential for environmental taxes to be regressive in their effect.
Furthermore, consumers will become cynical about tax revenues raised for environmental reasons unless it can be demonstrated that the environment benefits by helping the environment recover from polluting activity or by encouraging an environmentally beneficial activity.
Earmarking of environmental taxes should also be considered, although Euro Coop recognises that spending money raised by environmental taxes on environmental purposes has to be weighed against other priorities.
Euro Coop supports the contention in the Commission's Communication that where environmental taxes or charges are introduced they should start at low rates and be progressively increased, giving economic operators and consumers time and incentives to change their behaviour. We also strongly support the view that, in the first instance, subsidies should be removed from environmentally damaging activities.
The Communication also discusses a number of market-based instruments including providing information with the potential to improve integration of environmental and economic policies. Consumer Co-operatives have experience in terms of the role of consumer information in allowing consumers to make informed choices about the products they buy. For example, many Consumer Co-operatives have used environmental labelling
(e.g. the Nordic Swan and the EU eco-label) to give consumers information about the environmental impacts of the products they buy. In addition, many Consumer Co-operatives have supported 'third party' accreditation schemes (e.g. the Forest Stewardship Council's sustainable forestry labelling scheme). In truth, Euro Coop thinks that this has only a marginal effect at present, but it is an area we are keen to see developed.
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