A solidarity tax on drinking water, introduced by the regional Walloon government, is expected to raise EUR 2 million annually for development aid. The new tax is an initiative of Mr. Benoît Lutgen, Minister for Agriculture, Rural Affairs and Environment of Wallonia. For each m3 of water, users will pay 1.25 Eurocents; this will amount to approximately EUR 1.25 per household per year. The proceeds of the tax, about EUR 2 million per year, will support drinking water and sanitation projects in developing countries.

The new tax is an extension to the international level of the existing “Social Fund for Water” which provides financial support to residents in Wallonia who are having difficulties in paying their water bill. This fund is financed by a similar tax of 1.25 Eurocents per m3 of billed public water supply. In 2004, 0.5% of the total number of connected households was eligible for support from the fund and received an average of EUR 132 [1].

Wallonia is reported to be the first area in the world to have introduced water solidarity taxes for both local and international levels.

[1] Ouvry, B. (2007). Access to water as a basic human right, different ways to fulfil this vital commitment, the case of Belgium and its Regions. Paper presented at the Roundtable on the Human Right to Water and the Protocol on Water and Health, Geneva, Switzerland, 17-19 Jan 2007. PDF file [20 KB]

Related news: Italy: tax on bottled water for development cooperation, Source Weekly, 11 Jan 2007

Contact: Henri Smets, henri@smets.com

Source: EMWIS, 16 Jan 2007

Tags: financing