Revenues from the environmental tax increased in 2023

Revenues from environmental taxes in the European Union amount to €341.5 billion in 2023, an increase of €6.9 billion compared to 2022 (+2.1%). Despite nominal growth, the share of these taxes in gross domestic product continues to decline, from 2.4% in 2010 to 2.0% in 2023. Similar dynamics are observed in the structure of all government revenues: the share of environmental taxes decreased from 6.3% to 5.1% over the same period.

This trend suggests that, despite inflationary increases in absolute amounts, environmental taxation is losing relative importance in the EU economy and budgetary system.

Almost half of the total amount of revenues in 2023 came from companies - 49.4%. Among them, the manufacturing, construction, mining and utilities (together 23.6%) and services sectors (25.8%) play the leading role.

In 15 EU countries, the share of taxes paid by households exceeded 40%, and in Ireland it reached a record 60.3%. On average in the EU, households contributed 48.3% of environmental tax revenues.

However, in some countries, contributions from non-residents account for a significant share. Luxembourg stands out in particular, where they accounted for 48.7% of environmental tax revenues - three times higher than in the next highest country (Malta, 17.4%).

Comparative analyses at the country level show significant differences: in the Czech Republic, Estonia and Romania more than 79% of environmental taxes are paid by companies, while in Austria, Luxembourg and Ireland the share is less than 39%. These differences indicate the heterogeneity of fiscal pressures across EU economies and may affect the competitiveness and behaviour of companies.

Reducing the relative role of environmental taxes may call into question the effectiveness of green tax reforms and require rethinking strategies to incentivise sustainable consumption and production.