OECD to raise taxes of firms harming nature

Organization for Economic Cooperation and Development

Organization for Economic Cooperation and Development

Organization for Economic Cooperation and Development (OECD) have alerted Government OECD to increase their investment in nature restoration along with an announcement of imposing taxes for companies that are posing a threat to nature. A meeting of environment ministers from G7 nations took place on the weekend in Metz, France. The agenda was to deliver a set of proposals in favor of changing humanity’s relationship with nature as a consequence of a mega-report of UN, which showed a decline of Earth-life-support systems. The head of OECD pointed out that degradation of nature was heading to a catastrophe.

In the wake of the situation, new tax policies were introduced. Currently, environment-related taxes constitute only 1.6% of the global economic output, which is “microscopic”. It was also reported that only a hundredth of that fraction generated revenue for biodiversity, as little as $50bn (£38bn) a year, which is only one-tenth of the total subsidies paid to companies of fossil fuels and agribusiness.  The gathering drew plans to escalate the taxes, while also protecting the needs of the poor.

The ministers proposed that the balance of incentives needs to shift in order to avoid breakdown of climate and collapse of the ecosystem. It was further advised that a switch of priorities could help redirect economic systems towards positive natural growth rather than material extraction. Although they admitted that such a plan was not feasible since many legislators were dependent on finances from energy companies and farm lobbies. Especially the dependence of stock indexes in Tokyo, London and New York on mining and petroleum companies was highlighted.

A large amount of money is lost every year due to soil erosion, pollinator loss, water pollution, and climate instability, this was confirmed by a global assessment report by UN Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (Ipbes). It says that the only way to tackle this problem is by changing financial incentives and capacity building.