Environmental cross-border taxation from an international (trade) law perspective : bringing coherence to the legal chaos
(2016)
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- Authors
- Supervisors
- Traversa, Edoardo
- Abstract
- The objective of my doctoral research was to determine the legal limits to the adoption of environmental cross-border taxes, namely taxes on ‘internationally traded goods’ used in order to complement domestic environmental policies for combating global environmental challenges. The research brings coherence to the legal literature surrounding this ‘hot’ topic - which involves legal issues of environmental law, tax law and international trade law - by providing a broad-based analysis of the legal issues that should be considered before the adoption of environmental cross-border taxes, going beyond the question of their WTO law compatibility. The analysis distinguishes between two main mechanisms for the development of environmental cross-border taxes: [1] the mechanism of environmental border tax adjustments (this has been the most discussed by the economic and legal literature) and [2] alternative mechanisms based on other international trade law instruments (in particular the case of environmental tariffs). The research discusses the rationale, tax design and legal framework of these two models. Legal scholarship has largely underestimated the role of the rationale behind cross-border taxes. However, analysis of the rationale of cross-border taxes is key for determining the extent to which traditional cross-border taxes allow the pursuit of environmental goals. The research points out that environmental border tax adjustment may not be suitable for sanctioning a specific group of countries. In contrast, environmental tariffs (through the adoption of environmental free trade agreements) could permit the achievement of this goal. The traditional rationale of border tax adjustments could however leave space for the adoption of measures complementing environmental taxes imposed on domestic products. Next to their rationale, the doctoral research analyses the tax design of environmental cross-border taxes, including their tax base and tax rate. The analysis of the tax design allows the assessment of how - and to what extent – environmental criteria could be integrated into cross-border taxes, taking into account the way these taxes are implemented in practice. The doctoral research develops various tax models: excise duty-based models (including models based on the US Superfund tax, one of the few concrete example of environmental border tax adjustments); models based on the value-added tax (including the example of the ‘carbon-added tax’), models based on the retail sales tax, environmental tariffs, etc. The legal framework of cross-border taxes finally allows the evaluation of the legal limits deriving from superior international norms (mainly WTO law) to the adoption of environmental cross-border taxes. The research demonstrates that – even though WTO law’s mainstream interpretations may significantly limit the possibility of adopting environmental cross-border taxes – WTO law provisions surrounding environmental cross-border taxes may be interpreted in such a way so as to permit their development. In other words, the doctoral thesis argues that WTO law does not need to be changed in order to permit the adoption of environmental cross-border taxes, pointing out that non-traditional interpretations of WTO law could be enough. Aside from the analysis of WTO law, the doctoral research also highlights that principles of international public law, environmental law, and international tax law, do not prevent the adoption of environmental cross-border taxes.
- Affiliations
Citations
Pirlot, A. (2016). Environmental cross-border taxation from an international (trade) law perspective : bringing coherence to the legal chaos. https://hdl.handle.net/2078.5/48512