Littera Scripta (Jan 2011)
Analysis of EU budget income structure with respect to possible changes thanks to emission allowances charging
Abstract
This article introduces the area of the EU budget with regards to the possibility to adjusting income structure thanks to emission allowances charging. It defines major challenges for the EU budget and reasons why the reform is needed. The article contains the structure of the main items of both expense and income budget sides. The reader is acquainted with the source: VAT. The area of the emission allowances trading (EU ETS) is analyzed, which represents important item of income. However, this should change within the 2014-2020 financial framework. The paper shows possibility of increasing budgetary income via revenue from emission auctions, which would represent a change of the EU budget income structure. Through the means of simulation of the levy of the Czech Republic from the VAT source and from the potential source “revenue from emission allowances auctions” for the period of 2013-2020 are predicted. The final part contains a discussion about new challenges within the effort to optimize and reduce budgetary expenses – thanks to the reform of the source – replacing VAT. This source is very sensitive to oscillations of the economy. That’s why the EC suggests a dual system of tax rates – on the level of member state and on the EU level.
