This report, stemming from a collaboration between Green Budget Europe, The Ex’tax Project, Institute for European Environmental Policy and Cambridge Econometrics, presents the findings and results of the project Best Practices in the Promotion of Circular Economy in Finland. Firstly, it identifies tax options, other economic instruments and best practices to promote circular economy goals. Secondly, it presents an ambitious scenario for green fiscal reform, which aligns fiscal policy with carbon-neutral circular economy objectives. In addition, it assesses through modelling some of the potential economic, environmental and social impacts of the particular green fiscal reform scenario. Finally, it provides concrete examples of best practice in other market-based instruments applied in Europe to achieve these goals.
The modelling results suggest that the scenario increases GDP and employment by 1.2% in 2025 compared to the business as usual scenario. Similarly, CO2, SO2 and NOx emissions would be reduced by 6.0%, 8.1% and 6.3% respectively. Exports and imports would be virtually unaffected, apart from energy imports, which would be reduced by 6.1%.
The report is available on the EU Green Budget website.