3FOOD

Third Industrial Revolution Consulting Group
2.2 Pilot test blockchain technology to track circular economy inputs, throughputs, and
outputs of supply chains and value chains of public institutions and private businesses.
Blockchain is a distributed ledger that encrypts transactions that are also auditable.
Blockchain appears to be a useful tool for tracking, measuring and validating the flows of
waste, pollution, and overall resource use. Blockchain could serve as the repository of
metrics indicators in the circular economy.
2.3 Support a collaborative innovation network (COIN) platform for designers, practitioners,
and related professionals to interact, share and cultivate pathways for scaling up both
skills and investment in circular product design and production which could facilitate
greater re-use, remanufacture, repair and recycling.
3 Regulatory
3.1 Implement a taxation system that places the nation as the EU circular economy leader;
or at least raise circularity to levels commensurate with the EU average. A key part of
the circular economy is internalizing the costs associated with externalities incurred during
economic activities. Luxembourg embraces the principles of polluter pays and user pays.
An innovative tax system motivates actions to innovate on the production side through
resource efficiency improvements that cut costs, as well as motivating customers to
purchase more energy and resource efficient products to lower costs. This systematic
change aims at increasing the tax rate on material consumption, while incentivizing the reuse
of high quality materials / components with lower taxes. The additional tax income
should be used to lower the work related taxes in such a way that the total tax burden is
not increasing. Luxembourg’s current environmental taxes amount to 2% of GDP, down
from the 2004 level of 3.03% of GDP. According to the January 2016 report on
Environmental Fiscal Reform issued by the DG Environment of the European Commission,
Luxembourg’s current rate is among the lowest in the EU28: ranking 20 th for overall
environmental taxes as a percent of GDP, 24th for taxation of pollution and resources, and
25th for transport (excluding fuel). 328
328 Eunomia (2016) Study on Assessing the Environmental Fiscal Reform Potential for the EU28, January 2016, by
Eunomia Research & Consulting Ltd for the DG Environment of the European Commission,
http://www.eunomia.co.uk/reports-tools/study-on-assessing-the-environmental-fiscal-reform-potential-for-theeu28/
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