This report presents the OECD methodological guidelines for compiling Environmentally Related Tax Revenue accounts. The guidelines are in line with the System of Environmental Economic Accounting and ensure consistency with national and international data sources and manuals. The OECD guidelines are based on those of Eurostat with refinements and additional memo items. First, revenue from greenhouse gas taxes is split into two sub-categories: an energy-related part (recorded as an energy tax) and a non-energy-related part (recorded as a pollution tax). Second, four "memo items" are introduced to enhance the relevance of the accounts for policy work: (i) certain land taxes, (ii) taxes on oil and natural gas extraction, (iii) taxes on the resource rent and (iv) elevated VAT levied on environmentally related tax bases. The practical application of these guidelines was successfully pilot-tested in 2018-19, and the guidelines were implemented in the 2019 and 2021 rounds of data collection from OECD member and partner countries. The results show that it is feasible to compile the accounts, including the refinements and the additions outlined in this document, across OECD and beyond.
Methodological Guidelines for Environmentally Related Tax Revenue Accounts
Abstract
Executive Summary
This document presents the OECD approach and methodological guidelines for compiling environmentally related tax revenue (ERTR) accounts. The guidelines are in line with the System of Environmental-Economic Accounting (SEEA) and the System of National Accounts (SNA), and build on applications in countries. They ensure, to the extent possible, coherence with available national and international data sources and manuals (OECD Policy Instruments for the Environment (PINE) database, OECD Revenue Statistics and the IMF Government Finance Statistics Manual).
The OECD guidelines aim to support the compilation of harmonised ERTR accounts internationally. Developing the guidelines provided an opportunity to reflect on the conceptual foundations of existing methods and identify aspects that might deserve to be further developed in the future. The statistical guide developed by Eurostat for compiling ERTR accounts was used as a starting point, and a few refinements and four “memo items” are introduced:
Increased focus on taxes levied on greenhouse gas (GHG) emissions arising from different activities by splitting their tax revenue into two sub-categories: an energy related part (recorded as an energy tax) and a non-energy related part, such as certain GHG emissions related to landfills or agriculture (recorded as a pollution tax). This further strengthens the internal consistency of the accounts, while allowing the OECD accounts fully consistent with those reported by Eurostat.
Introduction of four "memo items" (i.e. information items that do not change the total) to enhance the relevance of the accounts for policy work: (i) certain land taxes, (ii) taxes on oil and natural gas extraction, (iii) taxes on the resource rent (profit taxes only) and (iv) elevated VAT levied on environmentally related tax bases. These items describe important transactions concerning the use of environmental assets and their joint collection is considered a useful source of additional information.
The practical application of the OECD guidelines was successfully pilot-tested in 2018-19, and subsequently two rounds of data collection were conducted in 2019 and 2021 involving OECD member and partner countries. The results show that it is feasible to compile ERTR accounts, including the refinements and additions outlined in this document. They also show that the guidelines can facilitate the compilation of SEEA-consistent ERTR accounts across OECD member countries and beyond.
