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New Austrian Chancellor Alexander Schallenberg will continue his predecessor’s green policy, which means that the country will still introduce a carbon tax from 2022
What’s going on
- Alexander Schallenberg, who was appointed Chancellor of Austria on October 11, assured that the resignation of his predecessor, Sebastian Kurz, would not affect the government’s plans to reform the country’s tax system in order to reduce greenhouse gas emissions.
- In early October, the Austrian government announced the introduction of a new carbon tax from July 1, 2022 – Austrians will have to pay € 30 for each ton of CO emissions produced.2, and in 2025 this figure will rise to €55.
- Thus, the government expects an additional €5 billion in tax deductions by 2025.
- In addition, each resident of Austria will receive an annual refund of this fee in the form of a “climate bonus”, the exact amount of which is determined by the place of residence. According to preliminary estimates, a family of two adults and two children living in Vienna can count on compensation in the amount of €300.
- The main goal of this measure is to motivate the population to choose environmentally friendly modes of transport and heating.
What does it mean
As a result of early elections in Austria in the fall of 2019, a coalition government was formed as part of the conservative People’s Party, as well as the left-liberal Greens as a junior partner. One of the key projects, in which, despite a noticeable difference in political positions, representatives of both ruling parties participated, is a large-scale tax reform, of which the unique system of “climate bonuses” became a part.
Since Kurz’s resignation took place shortly before the approval of the 2022 budget, the Greens were afraid of derailing the green tax bill, but the new chancellor (also representing the People’s Party) first assured that the government’s course here would be continued.
The introduction of a carbon tax is a practice that has recently been gaining more and more popularity. With this measure, consumers of carbon fuels undertake to pay for climate damage caused by CO emissions.2 in atmosphere. On the one hand, this makes it possible to significantly reduce the costs of achieving emission targets through additional tax revenues. In addition, this practice raises public awareness of the climate agenda. Finally, clean energy is becoming more economically attractive for both businesses and consumers.
The introduction of a carbon tax is being discussed in different countries of the world, including in our country. However, at this stage, the government of our country is limited to a soft system of regulation of greenhouse gas emissions without taxation and mandatory payments.