Green taxes as a means of financing the EU budget: policy options

Green taxes as a means of financing the EU budget: policy options

This study commissioned by Helga Trüpel, Member of the Greens/EFA Group in the European Parliament, analyses four promising ecological revenue sources for the EU budget.






Drawing on a brief overview of the current Union budget, its shortcomings and its reform process, we assess the following options:

  • revenues derived from road fuel taxes,
  • carbon taxes,
  • energy taxes, and
  • fines imposed by the Court of Justice of the European Union.

The European Union’s budget is a key enabler for achieving common goals such as protecting the climate and environment, creating more social equity and economic cohesion or developing a cross-border research community. In 2016, its combined resources amounted to € 143.5 billion which accounts for around one per cent of the EU GDP or half of Germany’s federal budget.

Over the years the EU budget has become too complex and has diverted from its original intended design. This development has not only hampered democratic accountability, but also reduced the budget autonomy of the Union. Today, 86% of the EU’s total revenues stem from de facto national contributions. Green Budget Europe proposes to replace these non-genuine contributions with revenues derived from policy instruments that exert steering effects on the economy and incentivise more sustainable market behaviour.

A budget financed by such ‘green own resources’ would allow to 1) reestablish consistency with the legal provisions enshrined in the Treaties, 2) strengthen the role of the European Parliament in budget negotiations and 3) contribute to the transition towards a greener economy.

Download publication

Further reading

See also second Own Resources Study: “Communicating Green Own Resources: A New Narrative for the EU Budget

See also “Solidarity and Strength: the Future of the EU” – a paper by the Heinrich Böll Foundation in collaboration with GBE AdCom-Vice Chair Kai Schlegelmilch

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