Developments and opportunities for an ecological tax reform in Spain

Spain is facing serious economic challenges. The public debt in 2013 reached 92.10 per cent of GDP and the unemployment rate in December 2013 was at 25.8 per cent. In this context, there is an urgency to develop fiscal strategies that have the least impact on the real economy and that will affect employment positively, in a way that the welfare of the population is guaranteed, assuring the best possible impact on the financial sustainability of the State. At the same time, reducing the environmental impact, tackling climate change and reducing inequality are the main challenges in reaching a sustainable economic development. In addition, moving towards an energy efficient and low carbon economic development gives the opportunity to improve competiveness in the future. Spain is failing to meet the objectives established by the Kyoto protocol with domestic measures adopted within Spain, in comparison with other European countries and the OECD. Greenhouse gas emissions have fallen since 2008, but this decrease is largely as a result of the reduction in the economic activity which has been particularly notable in Spain. The Spanish industry still has not made sufficient advances in terms of energy efficiency and decarbonization of the economy, and the exterior dependency on primary energy sources continues to be very high (about 75 per cent in 2012).