Tax has a significant role to play in influencing the behaviour necessary to achieve a sustainable economy both in Ireland and internationally. In order to meet the targets set for a greener economy, a carrot and stick approach is being taken with both tax incentives and punitive tax measures being introduced or proposed for both corporates and individuals. Various environmentally focussed tax measures, driven both at an Irish domestic level and an EU level, have been and will be introduced.
At an Irish domestic level – Climate Action Plan 2021
With the implementation of the Climate Action and Low Carbon Development (Amendment) Act 2021, Ireland is legally bound to commit to move towards a climate resilient and climate neutral economy by 2050 at the latest.
The ambitious Climate Action Plan 2021 (CAP21) sets out proposed tax policy measures to address climate change. Carbon and motor tax regimes have already been introduced and other measures under CAP21 include an emissions-based tax regime for light goods vehicles, phasing out VAT rebates on commercial fuel use, supporting the use of accelerated capital allowances in energy efficient equipment and taxation measures to help meet the building retrofit targets.
At European level: 'Fit for 55'
The 'Fit for 55' European Green Deal package, released in July 2021, aims to deliver a 55% reduction in greenhouse gas emissions by 2030, as an intermediate step towards carbon neutrality by 2050. As part of this package, it is proposed to revise EU legislation on Carbon Border Adjustment Mechanism, Energy Taxation Directive and the EU Emissions Trading System. The package also sets strict standards for industry, carbon pricing and taxes in an effort to promote investment in low-carbon fuels, technologies and infrastructure.
on its €1bn inaugural green bond issuance
on the acquisition of a portfolio of solar power development projects throughout Ireland.
Greencoat Renewables plc
Greencoat Renewables, the renewable infrastructure company, on its acquisition of the Cordal wind farm from Cubico Sustainable Investments, a global renewable energy investor and operator.
on the €500m Dublin Waste to Energy Facility.