- Governments are using taxation as a tool for sustainability, focusing on environmental taxes.
- Environmental taxes are becoming central in fiscal agendas to reduce environmental impact.
- Green VAT/GST represents a reform of indirect tax systems to promote eco-friendly behavior.
- Traditional VAT/GST are neutral, but environmental taxes aim to change behavior by increasing costs for harmful products.
- The shift in VAT/GST systems is part of broader green tax reforms, including reduced rates for eco-friendly products.
- The EU’s Reduced VAT Rates Directive allows lower VAT rates for green products like solar panels and electric bicycles.
- Green VAT/GST rewards eco-friendly choices and penalizes harmful ones through reduced or zero rates for low-impact goods.
Source: vatabout.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
