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European budget and sustainable growth

The role of a carbon tax

by Alberto Majocchi (Author)
Monographs 166 Pages
Series: Federalism, Volume 10

Summary

In the first part of the book an analysis is developed regarding the fiscal structure of the Monetary Union, starting by the Maastricht constraints and going through the Stability and Growth Pact to the Fiscal Compact. The main idea is that a new structure of the European budget should be promoted, with an increased size and new own resources, overcoming the limits of the current structure either on the revenue side or on the expenditure one. The main role of a renewed budget will be to provide the European public goods that are necessary to guarantee internal and external security, protection of the environment, technological innovations and all the measures that are needed to support growth and competitiveness of European production. A Stabilisation Fund should be put in place, so that the Eurozone could be able to face with adequate means a new general or asymmetric shock.
The second part is devoted to the problem of providing new own resources to the European budget. After a brief overview of the current system and its limits, the main proposal is to introduce a carbon tax that will complement the existing Emission Trading System. The new tax should be levied on the emissions of carbon dioxide generated by the use of fossil fuel, with a rate proportional to the carbon content of the fuel. This tax is a way of "getting prices right", putting a price on negative externalities produced by the combustion of fuels, which generate CO2 emissions. This proposal is politically acceptable only if the new tax will not worsen the external competitiveness of European production. This result could be achieved if a similar levy is put on the border on imports of "like" goods coming from countries where a price is not put on the use of carbon dioxide emissions through a system of border tax adjustments, compatible with WTO rules.

Table Of Content

  • Cover
  • Title
  • Copyright
  • About the author
  • About the book
  • This eBook can be cited
  • Table of contents
  • Part I: Fiscal policy in the European Union
  • Chapter 1: Introduction
  • Chapter 2: Fiscal rules in the Monetary Union
  • 1. The logic underlying the process towards the Maastricht Treaty
  • 2. Maastricht constraints and fiscal policy
  • 3. From Maastricht constraints to the Stability Pact
  • 4. The content of the Stability and Growth Pact
  • 5. From the SGP to the Fiscal Compact
  • 6. The need for quantitative limits on the deficit
  • Chapter 3: The structure of the Monetary Union
  • 1. The degree of centralisation within the Monetary Union
  • 2. Reform proposals of EMU governance
  • 3. A new fiscal architecture of the Eurozone
  • 4. A budget for the Eurozone
  • 5. A revised structure of the EU budget
  • 6. A reform of the Multiannual Financial Framework
  • 7. The increase in the size of the EU budget
  • 8. The unavoidable institutional changes
  • Chapter 4: Stabilisation of the European economy
  • 1. The policy of stabilisation of the European economy
  • 2. The inadequacy of the solutions called for in the Maastricht Treaty
  • 3. The regional stabilisation policy
  • 4. A European Unemployment Reinsurance Fund (EURF)
  • 5. A Rainy-Day Fund
  • Chapter 5: European policy promoting sustainable growth
  • 1. Weakness of economic policy management in the European Union
  • 2. The limits of national expansionary policies
  • 3. A policy promoting investments and production of public goods
  • 4. The Juncker Plan: a turning point, but not enough
  • 5. New resources for funding the Juncker Plan
  • 6. The External Investment Plan
  • Part II: New resources for the EU budget
  • Chapter 6: New own resources for the EU budget
  • 1. Double dividend and fiscal reform
  • 2. Other factors impacting on the fiscal structure
  • 3. A new structure for the fiscal system
  • 4. A gradual reform plan
  • 5. Progressivity in financing the EU budget
  • 6. The theory behind the progressive surtax
  • 7. New sources of revenue for the EU budget
  • 7.1. Financial Transactions Tax
  • 7.2. Value Added Tax
  • 7.3. Corporation Income Tax
  • 7.4. Digital Tax
  • Chapter 7: The Carbon Tax
  • 1. The rationale behind energy taxation
  • 2. A first European proposal of an energy-carbon tax
  • 3. The design of the energy/carbon tax
  • 4. From the carbon-energy tax proposal to the Emissions Trading System
  • 5. Limits of the Kyoto Agreement on curbing CO2 emissions
  • 6. A proposed revision of taxation of energy products
  • 7. Carbon tax and border tax adjustments
  • 8. A carbon tax for financing the EU budget
  • 9. Carbon tax and the Energy and Environment Agency
  • Chapter 8: Carbon leakage and border tax adjustments
  • 1. The relation between trade rules and environmental protection
  • 2. Domestic and global environmental goods
  • 3. Carbon leakages and external competitiveness
  • 4. The Rationale for Border Tax Adjustments
  • 5. Border Tax Adjustments and WTO Rules
  • 6. Tax Exemptions and Border Tax Adjustments
  • 7. The relevant role of border tax adjustment as a complement to carbon pricing
  • Chapter 9: Conclusions
  • References
  • Seires Index

Alberto Majocchi

European Budget
and Sustainable Growth

The Role of a Carbon Tax

About the author

Alberto Majocchi is Emeritus Professor of Public Finance in the University of Pavia. He has been teaching in the University of Venezia-Ca’ Foscari, Varese and Castellanza and in the University of Leuven. During the years 1991-93 he has been working as a National Expert in the Environment Directorate of the European Commission in Brussels. He is now Vice-President of the Centro Studi sul Federalismo (Turin) and President of Fondazione Magni for Ayamé (Ivory Coast)

About the book

In the first part of the book an analysis is developed regarding the fiscal structure of the Monetary Union, starting by the Maastricht constraints and going through the Stability and Growth Pact to the Fiscal Compact. The main idea is that a new structure of the European budget should be promoted, with an increased size and new own resources, overcoming the limits of the current structure either on the revenue side or on the expenditure one. The main role of a renewed budget will be to provide the European public goods that are necessary to guarantee internal and external security, protection of the environment, technological innovations and all the measures that are needed to support growth and competitiveness of European production. A Stabilisation Fund should be put in place, so that the Eurozone could be able to face with adequate means a new general or asymmetric shock.

The second part is devoted to the problem of providing new own resources to the European budget. After a brief overview of the current system and its limits, the main proposal is to introduce a carbon tax that will complement the existing Emission Trading System. The new tax should be levied on the emissions of carbon dioxide generated by the use of fossil fuel, with a rate proportional to the carbon content of the fuel. This tax is a way of “getting prices right”, putting a price on negative externalities produced by the combustion of fuels, which generate CO2 emissions. This proposal is politically acceptable only if the new tax will not worsen the external competitiveness of European production. This result could be achieved if a similar levy is put on the border on imports of “like” goods coming from countries where a price is not put on the use of carbon dioxide emissions through a system of border tax adjustments, compatible with WTO rules.

This eBook can be cited

This edition of the eBook can be cited. To enable this we have marked the start and end of a page. In cases where a word straddles a page break, the marker is placed inside the word at exactly the same position as in the physical book. This means that occasionally a word might be bifurcated by this marker.

Details

Pages
166
ISBN (PDF)
9782807609860
ISBN (ePUB)
9782807609877
ISBN (MOBI)
9782807609884
ISBN (Softcover)
9782807609853
Language
English
Publication date
2018 (December)
Published
Bruxelles, Bern, Berlin, New York, Oxford, Warsawa, Wien, 166 p., 1 tab. b/w

Biographical notes

Alberto Majocchi (Author)

Alberto Majocchi is Emeritus Professor of Public Finance in the University of Pavia. He has been teaching in the University of Venezia-Ca’ Foscari, Varese and Castellanza and in the University of Leuven. During the years 1991-93 he has been working as a National Expert in the Environment Directorate of the European Commission in Brussels. He is now Vice-President of the Centre for Studies on Federalism (Turin) and President of Fondazione Magni for Ayamé (Ivory Coast).

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Title: European budget and sustainable growth