Published:
27 Jun 2008 - Environmental taxes on construction
materials can be a key element in achieving
better sustainability in the construction
sector, says a report presented today by
the European Environment Agency. The study
reviews taxation schemes for extractive
activities in the Czech Republic, Italy,
Sweden and the United Kingdom, focusing
on a EUR 15.2 billion industry producing
essential materials for the construction
sector.
The aggregates industry
contributes significantly to Europe's economy,
where 3 billion tonnes of sand, gravel and
rock are released onto the market every
year.
Mining activities have
considerable impacts on the environment,
as materials are extracted directly from
the ground in surface excavations, such
as quarries or pits. More importantly, extraction
of aggregates can substantially alter the
landscape and affect groundwater reserves.
There are also associated impacts in terms
of energy use from the extraction and transportation
of these materials.
While the study acknowledges
that there is potential to extend taxation
in the area of natural resource management
to other sectors, it also reflects that
the four countries surveyed in the report
have achieved mixed results. Italy and the
Czech Republic showed weak evidence of improved
landscape following the introduction of
the tax, whereas Sweden has succeeded in
reducing demand for natural gravel — an
invaluable resource to guarantee groundwater
quality.
The report, presented
today at the 16th annual conference of the
European Association of Environmental and
Resource Economists (EAERE) in Gothenburg,
Sweden, also shows that taxes could encourage
innovation and support research and development,
in an attempt to balance economic growth
with the protection of environment and health.
The report states that
adopting environmental taxation schemes
is helping to improve the quality and reliability
of extraction data, which can then be used
to encourage changes in quarry management
activities. In the United Kingdom, for example,
the tax on raw construction materials gives
the sector added confidence when purchasing
materials, since part of the levy revenues
have been used to support the development
of quality standards for recycled aggregates.
Taxes work better as
part of a policy package
Other concerns highlighted by the report
Effectiveness of environmental taxes and
charges for managing sand, gravel and rock
extraction in selected EU countries include
the need to avoid tax distortions across
country borders. Coordination is imperative
to prevent an overload of extraction in
regions with lower or no tax schemes, underlines
the study. Furthermore, taxes 'need to be
used as part of a package of policies',
the report says, to ensure more effective
environmental improvements.
In recent years, the
EEA has published several reports assessing
policy effectiveness and has become increasingly
engaged in exploring the link between society's
needs and the final impact of policies.
