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25 Feb 2021, 13:14
Charlotte Nijhuis

Cutting climate-damaging subsidies can reduce social injustice in Germany – report

Clean Energy Wire

If the German government reduced ten climate-damaging subsidies in the areas of energy, transport and agriculture it could significantly reduce social injustice, according to a report by Green Budget Germany (FÖS) commissioned by Greenpeace. The report looked at the social impact of ten government subsidies in climate-damaging sectors, which amount to around 50 billion euros annually. It is mainly high-income households that benefit from these state subsidies, the report states. In the transport sector, for example, high-income households benefit far more than low-income households from the tax privileges for company cars and diesel fuel, as well as the VAT exemption for international flights, according to the report. Cutting these subsidies does not only help climate action, it also saves the government billions of euros and helps reduce social injustice, Greenpeace states in a press release. "Ending subsidies that are harmful to the climate creates space for investments in the future," said the organisation's Bastian Neuwirth.

The publication builds on a previous report by Greenpeace from November 2020 that examined the same ten subsidies in terms of their impact on climate action and the national budget. According to that report, cutting these subsidies could save Germany almost 100 million tonnes of CO2 equivalents and up to 46 billion euros every year.

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