Inaugural Addresses (School of Accountancy)

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    The role of tax instruments in reducing emissions from electricity generation in selected developing countries : a comparative study
    (Stellenbosch : Stellenbosch University, 2014-12) Dippenaar, Mareli; Nel, Rudie; Stellenbosch University. Faculty of Economic and Management Sciences. School of Accounting.
    ENGLISH ABSTRACT: There is not a single country in the world that remains unaffected by climate change, caused, inter alia, by the emission of greenhouse gases (emissions). Urgent change is therefore needed and government intervention is necessary. There are many different government approaches and instruments that can be used to reduce the emissions from electricity generation and frequently a combination of instruments will be most effective. One such measure is tax instruments. The effective use of tax instruments could stimulate investment in renewable energy, energy efficiency or research and development relating to these fields and could indirectly contribute to the reduction of emissions associated with electricity generated from coal and other non-renewable sources. A comparison is drawn across selected developing countries (South Africa, Brazil, China and India) that face similar climate change challenges to determine the primary focus of the countries in applying tax instruments to reduce their emissions from electricity generation (i.e. supply or demand; incentives or disincentives; direct or indirect taxes; and renewable energy, energy efficiency or research and development). The comparison also serves to determine whether the South African government’s use of tax instruments is in line with that of the comparative countries. It was found that the tax instruments in South Africa and India focus almost equally on the supply and demand of electricity, while the tax instruments in China focus on the demand side and those in Brazil place slightly more emphasis on the supply side. The primary focus in all the countries studied appears to be the use of incentives, rather than disincentives. The focus of their tax incentives appears to fall equally on the use of direct and indirect taxes, with the exception of South Africa, where hardly any indirect tax incentives are used. Furthermore, there seems to be an almost equal focus on renewable energy, energy efficiency and research and development in the countries studied, with the exception of China, where the number of tax instruments specifically aimed at energy efficiency significantly exceeds the number of instruments specifically aimed at renewable energy and research and development. Based on the findings, Brazil does not use tax instruments to target energy efficiency. A number of tax instruments were identified which the South African government could also consider in an attempt to contribute to the reduction of emissions from electricity generation.