Key Facts:   
Project Acronym: COMETR
Project Start: 1 Dec 2004
Project End: 30 Nov 2006
Coordinator: National Environmental Research Institute (NERI) - Denmark
No. of Partners 6
EU Contribution: 988 026 EUR



COMETR will advance the debate on competitiveness effects by undertaking the first comprehensive sectoral analysis of Europe's environmental tax reforms from an ex-post perspective. It will use modelling frameworks as well as case studies concerning the existing tax reforms which have taken place in the EU and Candidate countries. The COMETR programme of research is divided into 7 work packages, further details of which can be accessed directly below:

Work Programmes WP1 - 7

Project Summary:
The project will undertake an analysis of the competitiveness impacts of green tax reforms at a sectoral level, using modelling frameworks (bottom-up and macro-economic) as well as case studies concerning the existing tax reforms which have taken place in the EU and Candidate countries. The overall perspective is ex-post, in that actual experiences will feed the models, rather than uncertain ex-ante expectations, and this basic perspective constitutes one of the important innovative aspects of the proposal.

Conceptual clarification of the competitiveness issue, as well as a concise review of environmental tax reform experience will kick the project off (WP1).

Five to eight industrial subsectors will be selected on basis of data availability for comparative analysis, and the impact of tax reform design in six EU Member States (Sweden, Finland, Denmark, Netherlands, Germany and the UK) plus Slovenia will be reviewed. The world market conditions for the particular sectors will be studied carefully so as to identify different degrees of vulnerability (WP2).

Short-run impacts will be examined via a conventional bottom-up modelling framework, while a more dynamic modelling framework based on the E3ME model of Cambridge Econometrics will be applied to examine both short and long-run effects with particular emphasis on competitiveness. It captures inter-industry and other indirect effects, as well as those international competitiveness effects, which cannot be easily accounted for using the bottom-up approach.
The goal is to compare short and long-term costs of environmental tax reform. The dynamics of employment, output, external trade and investment in capital and R&D will be tracked along various reform scenarios (WP3 & 4).

A specific analysis of environmental decoupling and the possibility of carbon leakage is carried out (WP5).

Finally mitigation practices are considered in light of both modelling results and the more qualitative insights provided by case studies on the specific tax reforms and on the world market conditions in specific sectors (WP6).


Credit © European Community, 2004





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Page last updated: 18th January 2005 

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