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Greening the Budget

Budgetary Policies for Environmental Improvement

Edited by J. Peter Clinch, Kai Schlegelmilch, Rolf-Ulrich Sprenger and Ursula Triebswetter

Greening the Budget regards the fundamental cause of environmental degradation as government and market failure and proposes the use of budgets as an instrument of environmental policy to rectify this problem. The book focuses on the elements of the public budget which currently affect the environment and explores the scope for greening both revenue and expenditure through specific measures.
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Chapter 4: Green budget reform: case study of Slovenia

Budgetary Policies for Environmental Improvement

Kai Schlegelmilch and Tanja Markovic-Hribernik


Kai Schlegelmilch and c Tanja Markovic-Hribernik INTRODUCTION This chapter comprises a summary and partial update of a case study that is part of a wider project, which also includes an international seminar on green budget reform (GBR) at Lake Bled, Slovenia (Schlegelmilch, 1999). This study examines the potential for greening the budget in Slovenia. However, given that this is the first time that the Slovenian budget has ever been screened in terms of its potential environmental impact, data were hard to retrieve and bringing all these data together may be considered as pioneering work. The update was no easy task either, since major changes in the fiscal system such as the introduction of VAT took place in the meantime. In the following a definition of GBR and the reasons behind its application, particularly in Central and Eastern European Countries (CEECs), are provided. Furthermore, the aim, approach and structure of this case study are set out and major findings and recommendations presented. A GBR could be defined as a reform which comprises all fiscal provisions, either on the revenue or the expenditure side, and which are adjusted according to the criterion of sustainability. However, this is a long-term process and cannot be expected to produce results in the short term. REASONS FOR GREEN BUDGET REFORM Budgets have a big influence on the economy. Around 50 per cent of total gross domestic product (GDP) of industrialized countries runs through the public budgets. On the revenue side they direct the allocation of production...

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