One area where the Dutch charge sys

One area where the Dutch charge system has been less effective and regulations more suitable is the control of heavy metals from diffused sources. In conclusion, effluent charges for water pollution (in combination with regulatory standards) have been reasonably effective and acceptable in Europe. Where the charge rates were set at relatively high rates and escalated over time, there has been a continuing incentive for firms to minimize waste and to abate it. The charges have also been a major source of revenue for collective water treatment. It is also important to note the need for variability in charges according to source and type of pollutant
(i.e., small vs. large, toxic vs. non-toxic). Effluent charges for water pollution are quite relevant to developing countries that experience heavy pollution loads in rivers flowing through urban and industrial centers. Of the three country experiences reviewed, the Dutch system is the most relevant, not only because it has been very effective and administratively inexpensive but because it takes monitoring and enforcement difficulties into account, differentiating between large, medium, and small firms and households. Similar concepts to those of the Dutch system were used in formulating the proposed Industrial Environmental Fund for Thailand (Panayotou, 1993).
Effluent charges for solid waste are rarer than water pollution charges. Belgium imposes a charge of ECU 0.02 - 2.15 per ton of industrial and municipal waste, depending on the type of waste and its treatment before dumping, while exempting recycled wastes. To encourage recycling, Denmark charges ECU 5.20 per ton of “harmful” waste dumped. The Netherlands imposes a progressive charge on surplus manure, which is a major source of acid depositions, eutrophication, and soil pollution. The United States levies ECU 1.85 per dry ton of hazardous waste on waste site operations to finance the restoration of the site after closure. The problem with these simple charge systems for waste is that “low charges would not be effective and high charges would encourage evasive behavior and illegal dumping” (OECD, 1989). Therefore, effluent charges for solid waste are not recommended for developing countries unless they are combined with delivery bonds and auditing (see the proposed Industrial Environmental Fund for Thailand). User charges on waste disposal are preferable, more common, and their use is recommended for developing countries.
Product Charges
One product charge used by many European community countries, such as France, Germany, and
Italy, is a charge on lubricant oils. Its effectiveness in terms of waste oil recovered is high in Germany, where it is set at ECU 96 per ton, and low in France, where it is set at ECU 6 per ton. The most remarkable product charge is the Dutch new general fuel charge, which replaces five previous charges. Two thirds of this tax is a surcharge on excise duties applied to mineral oil, and one third is a levy. Its purpose is to raise revenues to finance the environmental programs of the Ministry of the Environment. The incentive value of the general fuel charge is low, but it is enhanced with rebates for installation of sulphur dioxide abatement technologies. Administrative costs are low, since they are tied to the excise duties on fuels.
Sweden—and to a lesser extent Norway—has a preference for product charges. Some common
charges include charges on batteries, fertilizers and pesticides, non-returnable containers, and oil products. The U.S. has a general feed stock charge on industries using chemical and other
hazardous materials in their production process in order to finance the “Superfund” for the cleaning up of abandoned hazardous waste sites. The incentive effect of this charge is limited and so is its efficiency, but it is well accepted by the industry.
In conclusion, product charges lack a strong incentive impact. Whatever reduction of waste is
accomplished it's because consumption of the product has been discouraged, not because the
producers have an incentive to minimize or treat waste. Thus, only prevention through sufficiently high product charges to discourage consumption and/or encourage reuse and recycling of reusable and recyclable material would result in environmental improvement. In contrast, the revenue-raising impacts of these charges is considerable, especially when the demand for the product is price inelastic. The administrative efficiency is also high because product charges are self-enforced.
Product charges, despite their drawbacks, have particular relevance to developing countries because they are virtually self-enforced. The low monitoring and enforcement capabilities of developing countries present difficulties for many other economic and regulatory instruments.