Reducing Pollution and Health Impacts through Fiscal Policies - Policy Brief

This policy brief outlines how fiscal policies can reduce pollution and associated health impacts while supporting sustainable development goals. It examines the use of taxes, subsidies and subsidy reforms to address air pollution and chemical pollution from pesticides and fertilisers, drawing on country experiences from Sweden, Chile, Indonesia, Denmark and Norway. The document highlights evidence that well-designed fiscal instruments can discourage polluting activities, encourage cleaner alternatives, improve public health outcomes and generate public revenue. It also identifies key design considerations, including tax structure, political acceptability, stakeholder engagement, monitoring and compensation measures, to maximise effectiveness and support long-term pollution reduction.