Presentation by Markus Riegler during the SBO meeting Climate Group of the OECD Working Party of Parliamentary, Budget Officials and Independent Fiscal Institutions (PBO) held on 8 December 2022.

1. CARBON TAX IN AUSTRIA
Distributional Impact
Markus Riegler
Austrian Parliamentary Budget Office December 8th, 2022

2. Carbon Tax in Austria
 Carbon Tax and “Climate Bonus” introduced as part of the Eco-social tax reform 2022
 Taxation of fossil fuels and energy (natural gas, heating oil) outside of EU-ETS
 Starting with 30 EUR per tonne CO2 in 2022, gradual increases to 55 EUR in 2025
 Lump sum compensation per person (Climate Bonus): 100 EUR - 200 EUR in 2022
depending on location of residence (population density, connection to public transport)
 Expected effect on emissions: -1.5 million tonnes CO2 in 2025 (-4.5 % of taxed emissions) according to
Environment Agency Austria
 Note: Introduction has since been postponed by a quarter and lump sum payment in 2022 was
topped up to 500 EUR per person to compensate for higher inflation. The analysis shows the
effects of the original legislation
 Two reports by the PBO:
 Analysis of the Eco-social tax reform (in German)
 Distributional effects (at request of a member of the budget committee, in German)
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3. Effects on Households
 Effects calculated mainly using microdata from Household Budget Survey
 Additional data on quality of public transport to calculate Climate Bonus
 Input-Output Table for indirect effects
 Financial effects on households:
 Compensation higher than revenues from carbon tax
 In particular in 2022, when carbon tax only affects half of the year but compensation is paid in full
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in million EUR (rounded)
2022 2023 2024 2025
Burden for households (incl. VAT) 370 860 1,080 1,290
Fuel 170 400 500 600
Natural gas 50 120 160 190
Heating oil 50 100 130 160
Other consumpion (indirect effects) 100 230 290 340
Compensation for households (Climate Bonus) 1,280 1,340 1,450 1,560

4. Distributional Effects by Household Income
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5. Distributional Effects by Household Income
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 Grouped by deciles of household income:
 Carbon tax and climate bonus are a higher share of income in the lower deciles
 Net effect: higher (relative) increase of incomes in the lower deciles

6. Distributional Effects by Household Income
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 High variation of net effect within deciles

7. Distributional Effects in 2025
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 Households grouped by location (4 categories of Climate Bonus):
 Lowest in Vienna
 …
 …
 Highest in rural areas with bad public transport

8. Distributional Effects in 2025
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 Households grouped by:
 Car ownership (yes / no)
 Heating system (natural gas, heating oil, other)

9. Thank you for your attention
Contact:
Markus Riegler
Economist
Phone: +43 1 401 10 2474
Mobile: +43 676 8900 2474
E-mail: Markus.Riegler@parlament.gv.at
Parliament, Dr.-Karl-Renner-Ring 3, 1017 Vienna, Austria
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