Experts from the Financial Research Institute Speak about Problems with Transition to Environmental Taxation

On 26 April 2024 in the Higher School of Economics a roundtable discussion was organized by the School of Finance of HSE University and Sain-Petersburg International Mercantile Exchange dedicated to discussion of carbon market stimulation mechanisms.

The research officer of the Center for Sectoral Economics of FRI of the Ministry of Finance of the Russian Federation Maxim Ivanov noted that the current negative environmental impact fee also imposed on methane emissions does not cover the expenses for the environment protection – the polluter pays principle is not functioning properly. There are high risks of tampering with the payment base. The discipline in submitting declarations is poor and the payment base is misrepresented.

The head of the Center for Tax Policy of the Ministry of Finance of the Russian Federation Milyausha Pinskaya added that comparison of information on emissions stated in 2-TP Vozdukh (a specialized statistical report which provides information on pollutant emissions in the atmosphere) and declarations on payment for the negative environmental impact shows a discrepancy, in spite of the fact that they should state the same indicators. For example, as for methane which is a greenhouse gas, according to declarations made by payers, emissions amount to 2.9 mln tons per year; according to 2-TP Vozdukh – 3.4 mln tons per year and according to applications for registration of negative environmental impact facilities – 76.2 mln tons. For a well-balanced implementation of carbon payments, in the first instance, it is necessary to sort out the mess with the payment base formation.

Participants of the roundtable discussion: vice president of the Saint Petersburg International Mercantile Exchange Dmitry Chernyshev, head of the School of Finance of HSE University Irina Ivashkovskaya, deputy head of the School of Finance of HSE University Elena Makeeva, professor of tax subjects at the School of Finance of HSE University Natalya Serdyukova, head of the Division of Tax Exemption Methodology of the Department for Analysis of the Effectiveness of Preferential Tax Treatments of the Ministry of Finance Zalina Musaeva, head of the Department for Environmental Regulation and Management of Greenhouse Gas Emissions of LUKOIL Grigoriy Yulkin, senior research associate of the Center for Tax Policy of FRI of the Ministry of Finance of the Russian Federation Yulia Steshenko and others.