Norwegian Tax System from the Point of View of Climate Change Policy

Michał Ptak

doi:10.12775/equil.2014.005

Abstract

Norway was the first country in the world to fix a carbon dioxide target. Norway was also one of the first countries to implement taxes to increase incentives to reduce greenhouse gas emissions. The aim of the paper is to analyse the role of environmental taxes in Norwegian climate policy. The author also examines the differences between the climate change policy measures in Norway and in the European Union countries, especially Poland.The first part of the paper contains an analysis of data on greenhouse gas emissions in Norway in the years 1990-2011. In the further sections of the paper the discussion is focused on the characteristics of Norwegian tax system and design of taxes used in Norway as instruments for addressing climate change. Particular attention is paid to the carbon tax, in force since 1991. The tax is responsible for large CO2 emission reductions. The paper is largely based on review of various reports, literature and websites on climate change policy, energy policy and transport policy in Norway.

Highlights

Climate change is one of the most important global environmental problems
Under the Kyoto Protocol, Norway committed to ensuring that its greenhouse gas emissions do not exceed 1990 levels by more than 1% during 2008-2012
From the climate change policy there is no justification for such tax rate differentiation: CO2 emissions from a litre of diesel are 12% higher than those from a litre of petrol (OECD 2011, p. 54)

Summary

Introduction

Climate change is one of the most important global environmental problems. The greenhouse effect that is leading to climate change is caused by a group of gases in the atmosphere which are transparent to incoming solar radiation, but trap infrared radiation (Czaja, Becla 2002, pp. 210-212). The greenhouse effect that is leading to climate change is caused by a group of gases in the atmosphere which are transparent to incoming solar radiation, but trap infrared radiation Greenhouse gases include, among others, carbon dioxide, methane, nitrous oxide, hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride. The reduction of the greenhouse gas emissions caused by human action is the objective of climate change policy. Greenhouse gas emissions can be reduced by inter alia: employing alternative low-carbon fuels, increasing energy efficiency or using energy-saving technologies. Policy instruments to address greenhouse gas emissions may include various instruments, such as regulatory instruments (such as fuel standards or energy standards for buildings), economic or market instruments (such as emission trading schemes or environmental taxes) and other instruments, for example voluntary agreements between industry and government

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