How can India expand its tax base

Improve the implementation of environmental tax legislation

initial situation

The industrial and demographic development of Algeria is associated with increasing environmental pollution and the depletion of natural resources. The polluter pays principle has been legally introduced in Algeria since 2003 and has laid the foundation for environmental tax legislation. It aims to tax pollution and the associated costs. These increase annually.

To take account of these external costs, the Algerian government has introduced 16 different environmental taxes. These particularly concern environmentally polluting and dangerous industrial activities, fuels, industrial and household waste and lubricants, but also petroleum products, air pollution and the import of tires or plastics. Some environmental taxes are directly related to climate protection. Part of these taxes go to the National Fund for the Environment and the Coastal Zone, set up by the Algerian Ministry of the Environment.

The fund finances technical measures to prevent environmental pollution, environmental protection activities at the point of origin, emergency measures in the event of accidents, and awareness-raising and information activities. However, the environmental tax system is unable to effectively calculate and levy taxes. Therefore, communication and data exchange mechanisms between the various actors involved must be organized more efficiently. The implementation of environmental tax legislation needs to be improved and the rate of tax collection increased in order to meet the challenges of industrial pollution more effectively. To this end, the tax collection rates for the polluting industries are to be improved. In addition, information is to be made available to these companies about financing mechanisms through which they can improve their production.

aim

The implementation of environmental tax legislation in Algeria has improved.

method

The activities focus on the one hand on introducing a sustainable system of environmental tax collection. On the other hand, they improve the knowledge and skills of interest groups and make it easier for companies to access environmental finance.

To this end, the project first conducts a comprehensive analysis of the environmental tax system. On the basis of this, it offers technical, organizational and strategic advice in order to optimize the environmental tax system.

In order to improve the legal framework, the project is developing technical proposals and is also supporting the creation of an inter-ministerial committee. It also promotes the use of new technologies and trains stakeholders who are involved in calculating the tax base and collecting environmental taxes.

In the course of this, the assessment base for environmental taxes is to be adapted to the actual environmental impact of the company. In addition, existing environmental tax guidelines are being revised.
In addition, the project offers technical support for the environmental directorates and measures for personnel development in order to introduce a SAP-based information system for the Ministry of Finance. It is intended to capture the tax base.

The project also takes stock of the existing financing and incentive mechanisms for environmental protection measures and organizes awareness-raising activities for companies, engineering offices, wilayas (administrative districts) and communities about industrial pollution and existing integrated solutions.

The focus is on promoting environmentally friendly technologies and processes and developing incentive mechanisms that improve the environmental performance of companies. An important component is the sensitization and advice of companies with regard to national and international financing mechanisms to reduce their pollution.

 

Status: October 2020