Tax policy review - low-income households and the green transition

Background

The EESC (European Economic and Social Committee) has worked on an own-initiative opinion titled "Tax policy review - low-income households and the green transition.", highlighting the need to address the social challenges and potential adverse impacts on low-income households during the green transition in the EU. The EESC calls for a fair and socially inclusive green transition, with targeted fiscal measures, redistributive policies, and support for vulnerable groups. It emphasises the need for differentiated approaches at the country and regional levels, and highlight the importance of data-driven analyses and long-term financial instruments to support the transition.

Key points

In the opinion, the EESC:

•    observes that the green transition's impact will vary across the EU, and Member States must address social challenges to maintain stability and legitimacy while avoiding populist opposition;

•    stresses that targeted analysis is crucial for identifying households affected by the green transition, enabling governments to take appropriate measures to support poorer and vulnerable households;

•    identifies two main risks of the green transition: growing income disparities and the displacement of industrial sectors and jobs. To mitigate these risks, national fiscal measures should be implemented to make the transition more sustainable and reduce its impact on the most vulnerable parts of the population;
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Additional information

- EESC section: Economic and Monetary Union and Economic and Social Cohesion (ECO)
- opinion type: Own-initiative
- rapporteur: Philip VON BROCKDORFF (Workers - GR II / Malta)
- reference: ECO/614-EESC-2023-00859
- referral: N/A
- date of adoption by section: 27/06/2023
- date of adoption in plenary: 12-13/07/2023

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