The Impact and Determinants of Environmental Taxation on Economic Growth Communities in Romania

Abstract

Environmental taxation represents a key influence on sustainable development in post-transition countries. Romania has experienced important transformations of environmental policy, including taxation, due to sustained reliance on traditional energy sources to satisfy its energy needs. The aim of this paper is to show a possible causal relationship between the Romanian GDP and several explanatory variables related to taxation of environmental damage and energy generation and consumption in the country. In order to do this, the authors make use of several statistical tests to verify the existence of a meaningful relationship between economic variables expressed in time series. The study has also attempted to identify the influence of environmental taxation on ensuring green economic development, starting from the premise that for emergent economies these taxes provide both a GDP increase and prevent environmental degradation by decreasing the pollution and environmentally harmful supplies and practices.