Taxation as an incentive for environmental friendly projects/measures

Abstract

Purpose: The purpose of this study is to analyse how environmental taxation in Malta is being used to protect the environment and how the revenue collected can eventually be reinvested to introduce more environmental friendly measures and projections. Supervision and regulation enforcements were also analysed in the process. Finally, an analysis was made on whether local tax practitioners are being involved enough in environmental taxation. Design: These objectives were successfully fulfilled through conducting twelve semi-structured interviews: eight with tax practitioners, an economist and representatives from Malta Enterprise, Ministry of Finance and Environment & Resources Authority Malta participated unconditionally for the purpose of this dissertation. Findings: This dissertation found that measures have been taken and will continue to be taken in order to help safeguard our environment. The ultimate objective is to make all forms of taxation and incentives as effective as possible and help shift the population’s mentality towards a more environmentally friendly one. Tax practitioners as well have a notable role to play in making their clients aware of the negative impact certain businesses have on our environment and the respective environment taxation and fines that need to be paid if policies are not adhered to. Strict enforcement and regulations need to be emphasised and one can argue that this is lagging behind. Conclusion: With environmental issues in Malta set to continue becoming more complex and difficult to overcome, environmental taxation has the potential to help Malta protect its environment and teach everyone the importance of taking care of our environment before it becomes too late. Government and policy makers hold key positions in making this happen but so does everyone else making use of our environment. Value: This dissertation goes on to show how the environment and the economy are inter-linked and need each other to flourish. It highlights the importance of environmental taxation in Malta and hopes to have managed to convince all interviewees and readers of the importance of incentivising businesses to protect our environment and the need for every one of us to do our part to live in a sustainable way.