The Legal Authority to Enact Environmental Taxation Instruments

This chapter will analyze the legal authority to enact environmental taxes, a competence that is generally vested in the national legislator. Environmental tax law is therefore subject to all the legal preconditions of the national constitution in question, and in some cases it is subject to relevant supranational law as well. For instance, a European Union (EU) Member State can implement a new national environmental law only if it is in line with EU legislation. The issue of legal competence primarily concerns questions of vertical competence within a system of multilevel governance: It can lie with a central authority, be it on a national or a supranational level, or be decentralized and lie in subdivisions like federal states and municipalities. Moreover, any relevant preconditions for the legislative procedure within parliament must be met, and the participation of other constitutional organs (such as other chambers of government) must be ensured to include a horizontal perspective of competence distribution. Finally, the legal authority enacting environmental taxes must take a variety of material restrictions into account, including constitutional principles such as basic rights and the rule of law (legality, retroactivity). Also important are the ability-to-pay principle relevant to tax law, and the polluter-pays principle relevant to environmental law. This analysis will also pay heed to possible restrictions the legislator may face that are derived from international or supranational law (such as European law).