This background report (attached) prepared by The Pembina Institute For Appropriate Development for SP, provides background information on environmentally oriented fiscal reform policies. There are three main components to the report. The first section describes the main arguments for pursuing fiscal reform to better integrate environmental costs and benefits into transaction prices. The second section presents experience with fiscal reform in various regions around the world, including Canada, the United States and Europe. The final section describes key lessons related to fiscal reform. These lessons can help inform policy developments in Canada.