1. Methodology background


 National Statistic   
 Survey name 
 Frequency  Annual
 How compiled  Based on third party data
 Geographic coverage  UK
 Sample size 
 Last revised  28 February 2010

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2. Executive summary

This Environmental Accounts Quality and Methodology Information report relates to statistics for environmental taxes, which is an important topic within the UK Environmental Accounts and aims to provide users with information on the usability and fitness for purpose of these estimates.

For further information regarding the methods and terminology used in UK Environmental Accounts, please refer to the following publications:

This document contains the following sections:

  • Output quality
  • About the output
  • How the output is created
  • Validation and quality assurance
  • Sources for further information or advice
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3. Output quality

This document provides a range of information that describes the quality of the data and details any points that should be noted when using the output.

We have developed Guidelines for measuring statistical quality; these are based upon the five European Statistical System (ESS) quality dimensions. This document addresses these quality dimensions and other important quality characteristics, which are:

  • relevance
  • timeliness and punctuality
  • coherence and comparability
  • accuracy
  • accessibility and clarity

More information is provided about these quality dimensions in the following sections.

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4. About the output

Relevance

(The degree to which the statistical product meets user needs for both coverage and content.)

An environmental tax is defined as a tax whose base is a physical unit such as a litre of petrol, or a proxy for it, for instance a passenger flight, that has a proven specific negative impact on the environment. This definition has been agreed by international experts and adopted by the Statistical Office of the European Communities (Eurostat) and the Organisation for Economic Co-operation and Development (OECD).

Therefore, by considering the effects of taxes rather than their aims, it is possible to understand the degree to which environmental issues effect how a government raises its revenue. For instance, a tax may be introduced with the purpose of increasing government revenue rather than reducing environmental degradation but this would not preclude its inclusion as an environmental tax.

Nevertheless, measures of environmental taxes should be interpreted and used with care. In particular, the levels of revenues from environmental taxes do not necessarily indicate the relative importance or the success of environmental policy. High environmental tax revenues can result either from high rates of taxes or from high levels of environmental problems (for example, pollution), leading to a large tax base. The broad measure of revenues can also fail to capture the effect of the differential rates that encourage a shift away from higher-impact behaviour (such as the use of leaded petrol).

Environmental taxes breakdown by 13 industries are based on general government environmental taxes data and input-output data for taxes on products and production, and are informed by the latest available supply and use tables. From these sources, it is possible to estimate allocations of environmental taxes to individual industries.

The following environmental taxes datasets are published as part of the UK Environmental Accounts release:

  • general government revenues from environmental taxes
  • environmental taxes by 13 industries

Estimates of general government expenditure are updated twice a year (each spring and autumn) to include the most recent national accounts public sector statistics. Estimates of environmental taxes by 13 industries are updated annually (each autumn) in line with latest public sector statistics and additional supply and use information provided by input-output analysis.

The environmental taxes data are compiled in accordance with the System of Environmental-Economic Accounting (SEEA) 2003, which closely follows national accounting standards set out in the System of National Accounts 2008 (SNA 2008) and the Eurostat handbook on the compilation of environmental taxes.

The data cover the UK as a whole; there are currently no estimates at a regional level.

These data are used to provide information for policy-makers and analysts. The primary users of these environmental taxes data, in government, are the Department for Environment, Food and Rural Affairs (Defra) although other departments such as HM Treasury have also used these data in their analyses. Outside government, research organisations and academia use the data in their work on environmental impacts and sustainable development.

Timeliness and punctuality

(Timeliness refers to the lapse of time between publication and the period to which the data refer. Punctuality refers to the time lag between the actual and planned dates of publication.)

Total government revenues from environmental taxes data are published three times a year, in the spring and autumn UK Environmental Accounts releases and in the UK National Accounts, The Blue Book. This allows estimates to be based on most recent data from National Accounts.

Environmental taxes by 13 industries are published annually in the UK National Accounts Blue Book with latest data available for the period 2 years earlier. This allows estimates to be based on most recent supply and use data, which incorporate latest national accounts information regarding the composition of the economy.

Notification of the exact date on which these data are published each year is made public approximately 3 months beforehand via the release calendar. To date, publication of these data has occurred without delay. In the unlikely event of a change to the pre-announced release schedule, public attention will be drawn to the change and the reasons for the change will be explained fully at the same time, as set out in the Code of Practice for Official Statistics.

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5. How the output is created

Data for general government revenues from environmental taxes comes from the public sector accounts. Environmental taxes are identified according to criteria laid out by the Eurostat handbook on the compilation of environmental taxes. By convention, in addition to pollution-related taxes, all energy and transport taxes are classified as environmental taxes. Further details regarding environmental taxes can be found in the article UK environmental taxes: classification and recent trends.

Data are allocated to 13 industries using information from national accounts supply and use tables and a variety of other sources, including UK Environmental Accounts carbon fuel and electricity use data. Further details of the methodology used to allocate environmental taxes to industry are available in the article Industrial analysis of environmental taxes.

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6. Validation and quality assurance

Accuracy

(The closeness between an estimated result and the (unknown) true value.)

As the true value for environmental taxes is never known, the accuracy of data is difficult to assess. However, most sources for public income are administrative and therefore not subject to sampling error.

One way in which to measure accuracy is reliability and this can be determined according to the magnitude of revisions. Table 1 shows the extent to which new information and methodology changes have caused data revisions between the most recent and earlier publications.

Coherence and comparability

(Coherence is the degree to which data that are derived from different sources or methods, but refer to the same topic, are similar. Comparability is the degree to which data can be compared over time and domain, for example, geographic level.)

Environmental taxes data are sourced from national accounts public sector accounts branch and are based on administrative data supplied by HM Treasury. During the compilation process validation checks ensure that published ONS environmental taxes data are consistent with the source data.

Environmental taxes data are published as a time series from 1993 and data within this time series are internally consistent enabling the analysis of emerging trends.

The UK Environmental Accounts are a satellite account of the main national accounts. As such, estimates of environmental taxes published in the UK Environmental Accounts are consistent with those used in the national accounts.

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7. Source for further information or advice

Accessibility and clarity

(Accessibility is the ease with which users are able to access the data, also reflecting the format(s) in which the data are available and the availability of supporting information. Clarity refers to the quality and sufficiency of the metadata, illustrations and accompanying advice.)

Environmental taxes data and text are presented in as clear a way as possible to ensure access to as wide a range of readers as possible. Plain English definitions are given where technical terms are unavoidable.

An overview of the UK Environmental Accounts can be found in Focus on Environmental Accounts.

Tables and analysis are published in the spring and autumn editions of the UK Environmental Accounts.

Tables and analysis are also published in UK National Accounts, The Blue Book.

Our recommended format for accessible content is a combination of HTML web pages for narrative, charts and graphs, with data being provided in usable formats such as CSV and Excel. We also offer users the option to download the narrative in PDF format. In some instances other software may be used, or may be available on request. Available formats for content published on our website but not produced by us, or referenced on our website but stored elsewhere, may vary. For further information please contact us by email to environment.accounts@ons.gsi.gov.uk.

General queries on environmental taxes data, compilation methods, quality information or difficulties finding the latest figures can be emailed to environment.accounts@ons.gsi.gov.uk.

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Contact details for this Methodology