30.11.2021

Austria's Entry into CO2 Pricing

WIFO Research Brief on the Tax Reform 2022-2024

In a recent WIFO Research Brief, Angela Köppl, Stefan Schleicher and Margit Schratzenstaller analyse Austria's entry into CO2 pricing, with which the federal government is following an increasingly strong trend both in Europe and globally.

This instrument is intended to provide incentives for restructuring economic and lifestyle patterns that not only help mitigate climate change, but also strengthen prosperity, resilience and competitiveness.

The tax reform package of the Austrian federal government ("eco-social tax reform") presented on 3 October 2021, includes CO₂ pricing as a new instrument in the mix of economic policy instruments. However, there still remain uncertainties concerning the design and effect of this instrument.