Fiscal Incentives for Biodiversity Conservation: The Icms Ecologico in Brazil

EEP Working Paper No. 00-01

55 Pages Posted: 9 Aug 2001

See all articles by Maryanne Grieg-Gran

Maryanne Grieg-Gran

International Institute for Environment and Development

Date Written: December 2000

Abstract

This paper evaluates an innovative tax revenue-sharing scheme in Brazil, designed to promote the conservation and management of protected areas. Known as the "ICMS Ecologico", the scheme was introduced by the state of Parana in Brazil and subsequently by several other states. The scheme aims to compensate municipal governments for the loss of potential tax revenue from the designation of protected areas (mainly by the state and federal government). It is also intended to have an incentive effect, encouraging both better management of existing protected areas as well as the designation of new conservation areas. The paper examines the experience with the ICMS Ecologico in the states of Minas Gerais and Rondonia, two states which present a marked contrast in terms of land use, population density and forest resources. It considers the extent to which the compensation and incentive objectives have been achieved in the two states. The distributional impact of the ICMS Ecologico is also examined through an analysis of the characteristics of the counties which are winners or losers under the scheme.

Keywords: conservation, protected areas, fiscal incentives, biodiversity

JEL Classification: H30,H23,N56,O13,O23,Q15,Q20,Q23,Q24,Q28

Suggested Citation

Grieg-Gran, Maryanne, Fiscal Incentives for Biodiversity Conservation: The Icms Ecologico in Brazil (December 2000). EEP Working Paper No. 00-01, Available at SSRN: https://ssrn.com/abstract=279173 or http://dx.doi.org/10.2139/ssrn.279173

Maryanne Grieg-Gran (Contact Author)

International Institute for Environment and Development ( email )

Department of Environmental Economics 3 Endsleigh Street
London WC1H 0DD
United Kingdom
+44 0 20 7388 2117 (Phone)
+44 0 20 7388 2826 (Fax)

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