In a world facing an urgent need to preserve the environment and promote sustainable practices, the role of taxation has become a central issue in efforts toward a greener future. Dynamic changes in the field of environmental taxation, both at regional and national levels, are introducing new regulatory requirements for reporting and compliance, which directly impact the operational and strategic aspects of business activities. At the same time, modern administrative and digital tools are being developed to facilitate companies’ fulfillment of prescribed obligations and to help them meet consumer expectations. The subject of this paper is the analysis of environmental taxes as a fiscal policy instrument aimed at achieving sustainable development goals and supporting the green transition. The primary objective of the research is to identify the potentials and challenges associated with the implementation of green taxes, with particular attention given to their impact on reducing greenhouse gas emissions, improving public health, encouraging environmental innovation, and generating budget revenues to finance green public policies. The methodological framework of the research is based on a qualitative analysis of secondary sources, including legal regulations, reports from international organizations, academic literature, and relevant case studies from countries with well-developed environmental taxation systems. The results suggest that when properly designed and fairly implemented, environmental taxes can significantly contribute to achieving environmental efficiency and promoting sustainable economic activities. However, their application faces numerous politicaleconomic and institutional challenges, including negative distributive effects and strong resistance from certain industrial sectors. Achieving the long-term effectiveness and sustainability of environmental taxes requires their alignment with complementary policies, ensuring transparency in revenue allocation, and strengthening international cooperation.