Estonia has been levying environmental fees or natural resource and pollution taxes for the past 18 years in order for entrepreneurs who make use of the nation’s mineral resources to contribute to their preservation and environmental protection. For example, those who use natural resources have to pay for mining rights, rights to the special use of water, fishing rights, forest felling rights and hunting district usage rights. Pollution taxes are designed for those whose operations pollute the air, water and soil and produce waste. “When work began on implementing the environmental tax system in the nineties the actual state of the economy was taken into account and the fees were largely symbolic, but still reminded entrepreneurs that those who use natural resources and pollute the environment have to pay for it,” said Minister of the Environment Jaanus Tamkivi. The rates of the environmental fees began to rise at the same time as the economy and the general level of people’s well-being began to improve. At first the increase was based on inflation, but thereafter a rate of between 5% and 20% per annum was agreed upon. However, the government decided in 2005 that the country had reached a point where the economy could no longer continue to develop at the same level of expense of the environment and that those who made use of the nation’s natural wealth should make a significant contribution to its preservation and restoration. “There was a huge jump in the rates of the environmental fees in 2006, and it was only after this that they started to fulfil the objective they were designed to, which is to say motivating entrepreneurs to operate in a more environmentally friendly manner,” Minister Tamkivi explained. “Having said that, the fees still don’t have a major impact on people’s pockets, with consumers only paying 3 or 4 kroons per month for the use of water and the tax only making up 2% of the costs of heating.” Over the 18 years that they have been used, the environmental fees have contributed 4.3 billion kroons to the state budget, which has been invested in the environmental protection of Estonia. A range of projects have been supported, including the construction of a large number of waste water treatment plants and utilities, drinking water pipelines, waste disposal sites and more. The environmental fees have motivated companies to contribute ever more to the development of environmentally sparing technology, with new machinery and equipment now in use in such areas as the treatment of oil shale residue and the production of heating energy. Unfortunately the rate of inflation in recent years has weakened the effect of the fees, which no longer provide adequate motivation from the point of view of environmental protection. Where next? To clarify future directions in the development of the fees the Ministry of the Environment has begun work on an environmental fee concept which will form the basis for establishing fee rates for the period 2010-2015 and amending the Environmental Fee Act. “The ministry’s wish is to discuss the concept and the amendments to the act in advance with representatives of interest groups so that it is clear to everyone how the fees can be put to best use in future for the good of both the economy and the environment,” Tamkivi said. Four working groups will be convened by the Ministry of the Environment for the development of the concept, looking at mineral resources, water, waste or air. Based on the initial schedule, the draft concept should be completed by the end of June, when it will be made public for further debate and proposals. The ministry hopes to have concluded discussions of the draft by mid-August, after which it will concentrate on making its amendment proposals with regard to the Environmental Fee Act, which in turn will be prepared with the participation of representatives from different interest groups. The amendments to the act should enter force in 2010, with the principles of the concept agreed upon until 2015. For further information please contact: Agnes Jürgens (7.05.2008) |
