Norway introduces a carbon-based incineration tax at short notice, only months after Sweden publishes its investigation into its own 18-month-old tax which it has found to be ineffective.
As of 1st January 2022, a mandatory waste incineration tax of NOK192 (~16GBP/20EUR) per tonne of fossil-based CO2 will be levied on all waste that is delivered to waste disposal plants in Norway. The tax is calculated by multiplying the tonnage of waste that is delivered to the incineration plant by a pre-determined national factor of 0.5498 per metric ton of fossil CO2, therefore the cost of the tax per tonne of waste is approximately 100NOK. However, this means all waste is treated the same no matter what its actual composition is, disincentivising recent innovations in the export sector producing low-plastic low-carbon RDF. This contrasts with the aim of the tax which is to contribute to a reduction of greenhouse gas emissions.
A similar proposal for a tax of NOK85 was rejected by the Norwegian parliament in March 2021 with the tax slated for re-design, but the tax was revived towards the end of the year with little time for industry to input or prepare for the tax. The Group calls on the Norwegian government to review the findings of the Swedish authorities on its similar tax, and ensure the Norwegian tax is evaluated and removed if the tax does not produce the desired effect.
Sweden introduced an incineration tax in 2020, which is currently 125SEK (~10GBP/12EUR) per tonne of waste incinerated. in A recently published review of the Swedish incineration tax by the Swedish Tax Agency has concluded that the tax is ineffective. One of the key drivers for introducing the tax was to increase recycling rates in the country and also in countries which send waste to be incinerated in Sweden. The evaluation has found that the impact on increasing recycling rates has been negligible in the short-term in Sweden, and has found no evidence of an increase in recycling rates in exporting countries either. Such arguments have been used by the Dutch Government to justify its import tax with little evidence behind this.
Overall, the review found that the tax is not an effective policy driver for a more resource-efficient or less polluting waste management system, nor does it support the transition to a more circular economy. The RDF Industry Group urges national governments to respond to this evidence and end these taxes that only serve to hinder the EU’s progress towards meeting climate goals.