INTRO: stating the q; motivate him; historical factsA number of EU members have implemented environmental tax reforms (ETR), defined as a reform of the national tax system that shifts the tax burden from labor taxation to energy and carbon taxation, and the reforms have been introduced for the first time in Scandinavian countries since 1990 and then applied in other European countries, such as Germany and Great Britain (PTAK, 2010; COMETR, 2007). This project summarizes an evaluation of the German ETR and its effect on technological innovation seeking to answer the research question: Has the German ETR increased technological innovation? The demand is motivated by general environmental considerations, for example, slowing global warming by reducing energy consumption and carbon emissions. The aim of my article is to specifically evaluate the effect of German ERTs on the level of technological innovation, and this is motivated by the following relevant facts. The German ETR was launched in April 1999 and has been adopted in Germany for more than ten years; therefore, there is a lot of data available to evaluate the impact of this ETR with respect to the German government's motivations. This ETR was proposed because the German government wanted to increase technological innovation, create additional jobs, and decrease energy consumption (Agnolucci, 2009; Beuermann and Santarius, 2006). Furthermore, it is important for us to evaluate the impacts of ETRs from different angles, for example, the level of technological innovation, rather than evaluating the impacts on the level of energy consumption and employment which numerous documents have discussed. The rest of the paper is organized as follows. Section 2 presents a review of related literature…… half of the article…… actively; therefore, it can be concluded that the ETR in Germany had a positive impact on reducing energy consumption, and the effect on employment is overall small and can be positive (Agnolucci, 2009)…..however….Moreover, Agnolucci applied an econometric approach to evaluate the effect of environmental tax reforms introduced in Germany and the United Kingdom, in particular their effects on energy consumption and the level of employment…. In this article, the author modeled his data by sorting it into the following various economic subsectors: textile and leather (TXT); Pulp, paper and printing (PPP); Rubber and plastic (RP); Non-metallic minerals (NMM); Machinery (MAC); Electrical and optical equipment (ELE); Wholesale and retail trade (TRA) which covered almost the entire spectrum of manufacturing activity. Therefore, I am able to use these subsectors later in my resolution process.