Analysis and legal support for reform of the current environmental tax and expenditure system in the Republic of Moldova

Donor: Organization for Economic Co-operation and Development (OECD)

Project duration: march 2022- february 2023

Overall goal is to identify the needed reform of existing environmental tax and payment instruments- in terms of their cost levels, their tax base and possible adjustments, how the taxes and payments are administered- and suggest new pricing instruments that can be introduced. The Consultant will also provide help in drafting and amending associated legal acts and government decisions.

General context: Environmentally related taxes are an important instrument for governments to shape relative prices of goods and services so that they factor in environmental damage, i.e. negative externalities. Environmental taxation is one way of encouraging a shift towards more sustainable choices. Employed in combination with other instruments such as regulation, it can help bring about the adjustments required to tackle the environmental and climate challenges facing societies today. Environmental taxation can potentially address all aspects of environmental protection and conservation: the fight against climate change, pollution – especially air and water pollution – and pressure on the environment, in particular from resource consumption and biodiversity loss, as well as contributory factors, such as gas emissions and the use of potentially harmful substances.