Ways in which fiscal policies can help ensure that the objectives of the Paris Agreement on climate change are met have been discussed at an event held as part of Green Week in Brussels on 31 May.

Opening the event, the Head of UNEP’s Economy and Trade Branch Steven Stone noted the growing recognition of the role of fiscal policies in supporting climate action, with almost 90 countries including some form of carbon pricing or other fiscal policies in their Intended Nationally Determined Contributions.

In his keynote speech, former German Finance Minister Hans Eichel stressed that a “once in a lifetime opportunity” exists to introduce carbon pricing and other reforms we cannot afford to miss. Fiscal policies such as carbon pricing and fossil fuel subsidy reform provide a cost-effective approach to addressing climate change by mobilising revenues, shifting incentives for investment and consumption and catalysing innovation in clean technologies, he argued.

The subsequent high-level panel discussion examined existing carbon pricing measures at national and EU level. Panellists agreed that carbon pricing does not have to mean higher taxes, but rather smarter, more efficient taxes and that they only form one part of the policy mix needed to ensure the Paris Agreement targets are met.

The event, titled ‘Making Paris Happen: The role of fiscal policies for the low-carbon, inclusive green economy,’ was organised by the Green Fiscal Policy Network - a partnership between UNEP, the International Monetary Fund and German Development Agency GIZ - in cooperation with Green Budget Germany/FÖS.

For a full report on the event click here and for further information please write to chiara.moroni@unep.org