A GHG-based wealth transfer tax – The missing link in the EUs environmental tax policy? An analysis of the legal limits imposed by the EU general principle of non-retroactivity
(2025) HARN60 20251Department of Business Law
- Abstract
- Recognizing the existential threat posed by climate change, the EU has pledged itself to ambitious GHG emissions targets. The adopted environmental measures such as the ETS, the ETD and domestic carbon taxes have been extensively criticised for their regressivity and resulting impact on less wealthy taxpayers. One aspect which is less often criticized, is that these measures impose significant monetary burdens especially on younger and future generations. In the light of the cumulative nature and extensive life cycle of GHG emissions, arguments could therefore be made for the adoption of environmental taxes which aim to promote a more equally shared monetary climate burden between different generations. One such measure could be an EU... (More)
- Recognizing the existential threat posed by climate change, the EU has pledged itself to ambitious GHG emissions targets. The adopted environmental measures such as the ETS, the ETD and domestic carbon taxes have been extensively criticised for their regressivity and resulting impact on less wealthy taxpayers. One aspect which is less often criticized, is that these measures impose significant monetary burdens especially on younger and future generations. In the light of the cumulative nature and extensive life cycle of GHG emissions, arguments could therefore be made for the adoption of environmental taxes which aim to promote a more equally shared monetary climate burden between different generations. One such measure could be an EU GHG-based wealth transfer tax, which could be designed to internalize the externalities caused by past GHG emissions. Both the general design of such a tax and its possible anti-avoidance measures would however have to respect the legal limits set by primary EU law. In this regard, a legal analysis of the policy’s reconciliation with the EU general principle of non-retroactivity is warranted. After a short definition of the latter’s content, the author analyses both the general design of the tax and a possible anti-avoidance measure’s compliance with the EU general principle of non-retroactivity. He concludes that the retroactive effects of the GHG-based wealth transfer tax could be based on multiple overriding matters of public interest such as the promotion of an intergenerationally equally shared climate change burden. When applying the case law of the ECJ, even a truly retroactive effect could be considered necessary in this context. Provided that sufficient transitionary measures are adopted, the legitimate expectations of the concerned taxpayers would also be respected. Thus, the proposed measure would not violate the EU but rather be reconcilable with the EU general principle of non-retroactivity. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9192433
- author
- Hodel, Niklas LU
- supervisor
- organization
- course
- HARN60 20251
- year
- 2025
- type
- H1 - Master's Degree (One Year)
- subject
- keywords
- inheritance taxation, environmental taxation, intergenerational equality, General principles of EU law, non-retroactivity, Polluter-Pays-Principle, arvskatt, miljöskatt
- language
- English
- id
- 9192433
- date added to LUP
- 2025-06-05 10:45:30
- date last changed
- 2025-06-05 10:45:30
@misc{9192433,
abstract = {{Recognizing the existential threat posed by climate change, the EU has pledged itself to ambitious GHG emissions targets. The adopted environmental measures such as the ETS, the ETD and domestic carbon taxes have been extensively criticised for their regressivity and resulting impact on less wealthy taxpayers. One aspect which is less often criticized, is that these measures impose significant monetary burdens especially on younger and future generations. In the light of the cumulative nature and extensive life cycle of GHG emissions, arguments could therefore be made for the adoption of environmental taxes which aim to promote a more equally shared monetary climate burden between different generations. One such measure could be an EU GHG-based wealth transfer tax, which could be designed to internalize the externalities caused by past GHG emissions. Both the general design of such a tax and its possible anti-avoidance measures would however have to respect the legal limits set by primary EU law. In this regard, a legal analysis of the policy’s reconciliation with the EU general principle of non-retroactivity is warranted. After a short definition of the latter’s content, the author analyses both the general design of the tax and a possible anti-avoidance measure’s compliance with the EU general principle of non-retroactivity. He concludes that the retroactive effects of the GHG-based wealth transfer tax could be based on multiple overriding matters of public interest such as the promotion of an intergenerationally equally shared climate change burden. When applying the case law of the ECJ, even a truly retroactive effect could be considered necessary in this context. Provided that sufficient transitionary measures are adopted, the legitimate expectations of the concerned taxpayers would also be respected. Thus, the proposed measure would not violate the EU but rather be reconcilable with the EU general principle of non-retroactivity.}},
author = {{Hodel, Niklas}},
language = {{eng}},
note = {{Student Paper}},
title = {{A GHG-based wealth transfer tax – The missing link in the EUs environmental tax policy? An analysis of the legal limits imposed by the EU general principle of non-retroactivity}},
year = {{2025}},
}