Recommendation 4

Ministers should consider how best to encourage behavioural change towards more sustainable and ethical patterns of consumption. Subsidies, environmental tax measures and tax reliefs are some of the financial and fiscal tools available to government. The Public Accounts Committee has criticised the Government’s grasp of the potential for tax measures to bring about environmental change and has recommended that from the next budget, the Treasury should: assess the environmental impact of every tax change considered; and publish the expected environmental impact for each tax measure in the budget, including the extent of behavioural change, alongside forecasts for tax receipts. The Treasury have since rejected these recommendations as impractical and not cost-effective. We consider this to be a short-sighted approach; it will be more costly to the environment and the economy to not consider fully the environmental impacts of policy and tax changes. The approach calls into question the extent to which environment costings are properly considered in developing and setting tax policy.

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