Brazil's ICMS Ecológico program to protect Biodiversity

In order to protect on of the world's richest biodiversity areas Brazil has developed the ICMS Ecológico, a tax revenue-sharing method that compensated municipal governments for designating protected areas. The state government is required to distribute 25% of the ICMS (a tax on the sale of goods and services) to the counties, but the states can determine the redistribution criteria on a portion of the funds. Several states have adopted an ecological criterion that looks at the amount of protected areas within the county, the level of protection, and a quality of the resources. The program has been particularly effective in the state of Paraná where the program has been operational since 1992.