Abstract
This study examines the legal and fiscal foundations of taxing green finance instruments in the service sector, with a particular focus on developing and developed economies. The research analyzes how Green Finance instruments such as green bonds, sustainability-linked loans, and eco-investments are regulated and taxed under different legal frameworks. Using comparative legal analysis and policy evaluation methods, the study identifies significant disparities in tax treatment between countries with advanced sustainability frameworks and those in early transition stages. The findings reveal that countries with structured tax policies supported by clear legal definitions and classification systems, particularly within the European Union, demonstrate higher efficiency in promoting green investments in the service sector. In contrast, developing economies face challenges such as unclear legal definitions, weak institutional capacity, and limited fiscal incentives. The study concludes that effective taxation of green finance instruments requires harmonized legal frameworks, targeted tax incentives, and improved regulatory coordination. Policy recommendations are provided to enhance the integration of green finance into national tax systems, particularly in service-oriented industries.