Norwegian wood promise, Coal subsidies unabated, Tax flight ‘exaggerated’ and Samarco fine increased
Norwegian wood promise
Norway is set to write a rainforest protection commitment into its public procurement policy after a decision by the Norwegian parliament’s standing committee on energy and environment. The Rainforest Foundation Norway said the pledge made Norway "the first country in the world to commit to zero deforestation in its public procurement". A growing number of countries are committing to sustainable purchasing. The UK already has sustainability requirements for a range of product types, including timber and paper products. Public procurement can make up to a quarter of GDP in some countries and is seen as offering potentially significant leverage in the move to greater sustainability.
Coal subsidies unabated
The world’s most powerful governments continue to subsidise coal-related projects despite climate change and air pollution concerns, according to a May report. The report, by the US National Resources Defense Council and other groups, found that G7 countries (Canada, France, Germany, Italy, Japan, the UK and the US) provided at least $42bn in subsidies for coal between 2007 and 2015. Much of it benefited rich-nation companies that build coal-fired plants in poorer countries. Japan was the biggest spender, most recently approving new coal power plants near Tokyo. The subsidies go against pledges increasingly made by financing institutions not to support coal. “Governments must limit future fossil fuel projects, beginning with coal, in order to address climate change,” the report says.
Tax flight ‘exaggerated’
Governments’ concerns about “tax flight” by the rich are exaggerated, a study for the American Sociological Review has found. Governments often resist tax rises for the wealthy – for example in the form of levies on bankers’ bonuses – on the basis that higher tax would encourage them to move elsewhere, resulting in an overall tax revenue loss. But the study’s authors examined 13 years’ worth of tax returns filed by American millionaires, cross-referenced with changing tax rates in US states. They found that “millionaire tax flight is occurring, but only at the margins of statistical and socioeconomic significance” as wealthy people prioritise, for example, quality of life over tax rates.
American Sociological Review report
Samarco fine increased
Brazil’s environment ministry (Ibama) has bumped up the fines levied on Samarco Mineração, the mining company that owned the tailings dam in eastern Brazil that collapsed in November 2015, causing the Bento Rodrigues dam disaster. The dam released toxic mud that destroyed 200 homes and killed 19 people. Shortly after the disaster, the environment ministry hit the company with Brazil’s largest ever environmental fine of $66.3m. In May, Ibama added $11.8m to the fine after an assessment of satellite images that showed the extent of pollution of the protected headwaters of the Doce River. Samarco, which is 50% owned by UK-Australian multinational BHP Billiton, is also required to rebuild the village of Bento Rodrigues and to remediate the environmental damage caused.