Implementing the System of Environmental Economic Accounting (SEEA) (United Nations et al., 2014[1]), building related global databases, and monitoring the use of environmentally related policy instruments are well-established core activities of the OECD. To support analyses on green growth, policy integration and structural policies, OECD work focuses on progressively establishing an integrated database on the economy and the environment. This work builds on a set of SEEA-consistent accounts, including environmentally related tax revenue (ERTR) accounts. Against this backdrop, this document presents the OECD approach and methodological guidelines to compile ERTR accounts, building on a long tradition of OECD work on environmentally related taxation.1
ERTR accounts open new possibilities for empirical analyses in a range of policy domains, including the transition towards green growth. ERTR accounts provide several benefits: First, they can easily be linked to a range of economic and social data in line with the System of National Accounts (SNA) (United Nations, 2009[2]). Second, given their systematic and coherent structure rooted in internationally agreed definitions, standards and accounting principles, these accounts facilitate international comparisons. Third, they are disaggregated by industries and households, and hence amenable to input-output and other industry-level analyses. Evidence gained from linking ERTR accounts to other accounts (e.g., air emissions, energy, material flows) and to socio-economic data will help establish more granular insights into the environmental, economic and social effects of environmental policies across industries, countries and time. These insights can support country reviews such as the OECD Environmental Performance Reviews and Economic Surveys.
ERTR accounts have been compiled already in 42 countries, including in Europe2, OECD countries such as Australia, Canada, Colombia, New Zealand and the United Kingdom, and non-member countries such as Albania, Kazakhstan, Mongolia and the Russian Federation ( (Eurostat, 2022[3]); (United Nations Statistics Division, 2022[4]); (OECD, 2022[5])). Given their potential to provide additional information and evidence for policy making and evaluation, a broader diffusion and implementation of ERTR accounts should be encouraged globally.
This document presents the OECD methodological guidelines for the compilation of ERTR accounts (hereafter referred to as "the guidelines") and recommends next steps for scaling-up the compilation of ERTR accounts across OECD member, accession and key partner countries, and beyond.
The objectives of the guidelines are twofold:
Expand compilation building on existing methodologies and data: The guidelines aim to facilitate the uptake and compilation of internationally harmonised ERTR accounts in line with the SEEA by considering lessons from existing applications and available data sources. They draw in particular on (i) existing accounting frameworks (SEEA and SNA), (ii) applications in countries (Eurostat’s statistical guide on environmental taxes (European Commission, 2013[6]) and Australia's ABS discussion paper3) and to the extent possible (iii) available national and international data sources and manuals (OECD Policy Instruments for the Environment (PINE) database, OECD Revenue Statistics and IMF Government Finance Statistics Manual (GFSM)). This exercise also serves as a starting point for further aligning information on ERTR across the accounts, the OECD PINE database, the OECD Revenue Statistics, and possibly beyond (e.g., OECD Taxing Energy Use).
Identify areas for future development: This work on developing and testing methodological guidelines provides an opportunity to reflect on existing applications for the compilation of ERTR accounts. While the methodology developed by Eurostat was used as a starting point, the guidelines identify three aspects that can complement existing approaches (see Section 2.9). First, they provide further details on greenhouse gas (GHG) emissions by introducing two sub-categories for taxes on energy and non-energy related GHG emissions. Second, the guidelines include four "memo items" for certain land taxes, taxes on oil and natural gas extraction, taxes on the resource rent (profit taxes only), and elevated VAT. Third, a common platform is developed that aims at ensuring coherence between the industry-level ERTR accounts and the instrument-level information provided in the OECD PINE database on environmentally related tax rates and the physical volumes being taxed.4
The remainder of this paper is structured as follows. Section 2 outlines the core features of the guidelines. Section 3 concludes with suggestions for next steps to expand ERTR accounts across countries and includes a research agenda to further advance the implementation of these and related accounts. Annex A illustrates the accounting of taxes on natural resource extraction in SNA and in the ERTR accounts. Annex B provides a practical implementation guide outlining the main steps and data sources to compile ERTR accounts in line with the guidelines.